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    How Drones Could Change The Shipping Industry
    Articles, Blog

    How Drones Could Change The Shipping Industry

    November 30, 2019


    Today, container ships transport more than
    90 percent of all goods in the world and more than 4
    trillion dollars worth of goods annually. But it can take over a month for
    those goods to sail from Beijing to New York. By land, trucks move nearly 71 percent
    of all freight tonnage in the United States. Problem is, there’s a shortage of
    truck drivers in the U.S. So how do you speed up
    shipments while keeping personnel low? The future of shipping
    looks very much unmanned. Anything that has high levels
    of customization, anything that’s unpredictable, that should be
    done by air. Many startups believe the answer
    is autonomous flying cargo drones that can carry heavy loads
    and fly long distances. All around the world, millions of
    people are benefiting from drones already, and we’re just at
    the tip of the iceberg. The global drone logistics and
    transportation market accounted for more than 24 million dollars in 2018,
    and that number is expected to grow to 1.6 billion dollars in 2027. These drones could be the disruption
    needed in a global supply chain that has been largely
    unchanged since the 1950’s. Getting large shipments of products
    across large distances is difficult. That’s why Malcolm McLean
    created the shipping container in 1956. This standardize the shipping industry
    and allowed shipping to scale in ways that
    weren’t possible before. For a typical product that is
    being shipped from overseas and then received within the United States,
    that would involve trucking, ocean freights, in some cases we’re seeing
    the emergence of more rail being used as it’s becoming a
    more reliable mode of transportation. But now, with programs like
    Amazon’s one-day shipping, consumers are looking for goods to
    get to them faster. That means the standard shipping methods –
    ships and trucks – have to be re-evaluated. There is a seemingly insatiable demand
    for things right away by consumers and that just keeps
    growing and people become increasingly impossible over time. What it seems like is the supply
    chains, which are wildly complex, are built around the timeliness
    of air freight. But the cost per item for
    air freight is significantly more expensive when compared to sea
    and ground shipping. We’re at the point where you
    really need to have those high-value goods or some kind of an
    emergency shipment would be an ideal candidate for air freight because
    it cost so much. In the United States in 2016, 11.6 billion tons of goods were
    shipped via truck, 1.8 billion tons were shipped via train,
    740 million tons were shipped via a cargo ship and only 5
    million tons were shipped via airplane. But using autonomous flying cargo drones
    to ship goods might bump that number up. Air freight is actually a mode
    of transportation that has increased dramatically. It’s still a small
    percentage of all freight being moved, but if you look at the
    percentage change over the years, air freight has been growing
    much more rapidly. I think a big reason for
    that is the growth of e-commerce. If you’re living in a small village and
    you want to ship goods and be a part of a global economy, often
    your freight link is by road or rail and it takes quite some time
    for your goods to be transmitted around the world. So when we bring autonomy and
    scale into aviation, every community can be connected with the rest
    of the world through a airborne freight link. And I think that that means
    massive potential for economic growth in communities all over the world. The main challenge is volume. You just can’t lift as much weight
    into the air as you can floated along the sea, especially if you’re
    trying to use battery powered vehicles like many of the smaller
    drones we see today. Current battery technology is incredibly
    heavy. Volans-i, a drone company that has been working
    in this space since 2015 created a hybrid vehicle that uses
    electric power to take off vertically, then standard fuel
    to fly off horizontally. So, if you build an all-electric vehicle,
    you have an 85 percent mass fraction on the batteries. So that means you can carry 15
    percent the rest of the weight in payload, which doesn’t really make
    sense for cargo delivery. See, the more volume you carry,
    the cheaper shipping becomes, even if that means traveling
    longer distances. Going in from Shanghai as an example,
    to the United States might take about 28 days by ship, whereas by
    airplane it’ll only take 14 hours. But still, ships are cheaper. A medium sized 2,000 pound box from
    Shenzhen, China to New York can cost $1,200 by ocean, but it
    can cost $4,000 by air. Natilus is working on getting that volume
    up and the costs down by using jet fuel powered drones
    to autonomously fly goods long distances, like across the ocean. Natilus is building large-scale unmanned
    aircraft the size of Boeing 747s to reduce global air
    freight costs by 50 percent. It will do this by using a
    uniquely shaped vehicle designed for cargo, not passengers, unlike other
    air freight carriers. When Boeing and Airbus design
    airplanes meant for passengers, whatever falls out is what the freight
    aircraft looks like and they’re not really optimized on volume. It also wants to utilize
    pilots more effectively. Instead of having two pilots on one single
    flight, it hopes to use one pilot managing multiple flights remotely. There’s a huge bottleneck with pilots
    today, which is limiting the expansion of air freight as
    well as passenger freight. But Natilus is still not ready to
    get its cargo drones into the air for deliveries. Companies like Volans-i have already
    started making deliveries in places like the Bahamas, a
    particularly difficult area for deliveries because of the large
    distances between islands. The company’s goal is to alleviate
    the shipping strains of high need, expensive shipping, like when a specific
    part needs replacing on a production line, and it needs to
    be replaced quickly since time is money. I started Volans-i out of a problem
    that I saw while working at Tesla. So imagine the Model 3 assembly line
    goes down for one hour. That costs the business hundreds of thousands
    of dollars, in some cases millions of dollars. And at that point, the companies
    and businesses are motivated to get that up-time and get the line
    going again at any cost. And Volans-i is trying to help
    with that business and with that problem. Other companies are trying to lighten
    the load of the ever critical last-mile delivery. That’s the portion of the shipping
    process that gets the product from its last warehouse or shipping hub to
    your door, and trying to hasten the delivery of medical supplies
    and samples for testing. Zipline has been delivering supplies
    in Rwanda since 2016, Ghana since April of 2019 and is
    expanding its service to the U.S. this year. UPS has teamed up with drone
    startup Matternet to quickly ship medical supplies from a North Carolina
    hospital to labs for testing. I think we can use this
    type of system to massively improve health care in the country. So imagine when you have to get
    that lab result back, how crucial it is to get it on time. And with a system like this, we
    can deliver the samples and then the results much faster than we can
    do it with the traditional transportation methods today. But news of these delivery drones
    has been flying around for years. Prime Air, Amazon’s drone delivery system,
    was teased back in 2013 and it still hasn’t rolled out
    the program, though Amazon recently announced that it will launch
    delivery drones within months. We’re building fully electric drones that can
    fly up to 15 miles and deliver packages under five pounds to
    customers in under 30 minutes. Well, the biggest thing I believe
    that’s pacing the development of the drone industry is regulation. FAA regulations are still pretty
    strict on these autonomous flying vehicles, and that has created
    a challenge for these drones. Competition for airspace is becoming more
    and more heated as drones of all sizes take to the air. There have been some restrictions by
    the FAA that have restricted the use of drones for delivery to
    consumer homes, and, you know, that’s something that needs to be overcome
    and they’re continuing to work on. Autonomy brings a whole new set of
    public concerns, just as we’ve seen with self-driving cars, because the
    public has grown to appreciate the safety and the assurance of being
    able to fly from one place to another. The regulators are hesitant
    to permit new technologies from entering the airspace until they
    are really proven satisfactorily. Another big concern when it
    comes to automation is jobs. As you hear some of the challenges
    related to drones, that’s one of the things I’ve heard come up. There would be this whole workforce needed
    to be able to manage this drone network. But this technology could help alleviate
    some of the worker shortages that the shipping
    industry is facing. I think what you’re seeing today,
    the airline sector, for example, has a massive pilot shortage and it’s
    forecasted to only get worse than the number of people that are going
    to be traveling by air is expected to double over
    the next 15 years. But customers, shippers and regulators all
    see the promise in these autonomous flying vehicles for
    emergency deliveries, for incredibly high speed home deliveries and even
    for large shipments of goods. So I think that there’s great
    opportunity here with unmanned cargo aircraft to start proving out some
    of the technologies in a lower-risk environment without people on
    board, and these same technologies can eventually be introduced
    to the aircraft that we will use for flying around
    cities to and from work. And I’m really excited about
    skipping the terrestrial traffic as well.

    How Amazon Delivers On One-Day Shipping
    Articles, Blog

    How Amazon Delivers On One-Day Shipping

    November 24, 2019


    Before Prime launched in 2005 one-day
    shipping was an exorbitant luxury. Now it’s the standard shipping speed
    for Amazon’s 100 million Prime members. Earlier this year Amazon doubled
    the speed of Prime shipping from two days to one. And the faster speed is now available
    on more than 10 million products. Prime one-day is basically going to A)
    keep up with the brick and mortar guys and B) enhance Prime. Amazon has changed
    the game completely. So what they excel at is getting an
    object from a creator to a consumer as flawlessly as they can and
    as quickly as they can. So Amazon is changing people’s
    expectations and they’re perpetually improving those expectations. But behind every Amazon box there are lots
    of people hustling and a lot of money spent to get it to
    you in just one day. Here’s what happens when you buy
    a Prime eligible item on Amazon.com. Amazon spends tens of billions
    on shipping every year. In just the last quarter of
    2018, Amazon’s shipping costs jumped 23%, reaching a record $9 billion. So why is it worth it? Well customers come to expect consistent
    fast delivery of anything on earth from Amazon. And our job is to
    continue to make that happen. And Amazon set aside $800 million just
    in the second quarter of 2019 to start making one-day
    shipping the norm. Most of that investment is
    going towards the infrastructure and transportation costs associated with speeding
    up delivery to the millions of Prime customers who are about to
    begin to experience one-day as the new normal. The difference with e-commerce is
    the costs never end. The pick, pack and ship happens every
    time a unit is sent out. To better control this process and its
    large cost, Amazon is cutting down its reliance on UPS and the U.S. Postal Service and is investing heavily
    in its own logistics network. It now handles the shipping
    for 26% of online orders. Amazon now has at least 50
    airplanes, 300 semi-trucks, 20,000 delivery vans and it operates ocean
    freight services between the U.S. and China. Amazon is looking to do it all. That shouldn’t be much of a surprise. The only thing that matters to Amazon
    is making sure the customer is happy and is paying for Prime
    every year or every month. What that means is sometimes you can rely
    on partners but you want to make sure that you have it in your
    pocket if that’s not the case. Other big retailers are also spending a
    lot to keep up with the fast shipping expectations Amazon
    has created. Walmart is rolling out free next-day shipping
    with orders of 35 dollars or more starting today. And target offers free two-day shipping
    on orders over 35 dollars. And during Amazon’s big Prime Day sales
    event July 15th and 16th, eBay plans to hold a crash sale
    offering 80% off big ticket items. Amazon’s 25 years old. The reality is that’s a really short time
    to be around to have become the number one player. So can anyone compete? Sure people can compete. Can they sustainably compete
    is the harder question. I don’t think we’ve seen it yet. The journey a package takes to your
    door starts before you even place the order. Most items on Amazon are sold
    directly to you by a third party. In Jeff Bezos’ letter to shareholders
    in April 2019, he said third-party sales have grown from 3% of total
    merchandise sales in 1999 to 58% in 2018. Amazon charges those sellers a
    fee to list items on Amazon.com starting around 15% of
    the item’s selling price. Amazon also sells things directly. In some cases Amazon buys inventory from
    a third party and then sells it to consumers. Other items are Amazon’s own brands
    such as Amazon Basics, Amazon Essentials, fashion lines like Lark & Ro
    and Alexa devices like the Echo. All items sold directly by Amazon
    are already sitting in an Amazon warehouse waiting to be
    ordered and shipped. Most third-party items fulfilled by Amazon
    are also already waiting at an Amazon warehouse, while others are sent directly
    from the seller or to an Amazon warehouse once you hit
    that place order button. Amazon does not disclose the
    details of its inventory strategy. Figuring out where a product sits before
    you buy it is a phenomenal mystery. It’s something that every
    reseller would love to know. And figuring out the code that is
    Amazon has been part of that hard process. After an item is ordered and ready
    at one of Amazon’s 175 fulfillment centers around the globe, it’s picked, packaged
    and shipped by some of its 250,000 warehouse workers often with help
    from one of its 100,000 robots. It’s essentially an amusement
    park for a box. There’s conveyor belts that go
    around, there are slides. It looks like a lot of fun. But the question is: how much is
    automated versus how much his manual labor? And that suite, blending that, figuring
    out how to have the least human touch points while ensuring the
    best quality control is that perpetual conversation. We visited a fulfillment center outside
    Seattle where 2,000 workers prepare packages on a couple million
    square feet of floor space. Workers here showed us the process of
    getting an item from the shelves to a box. We scan the item and make sure that
    that item is what matches what’s in our hand that’s on the screen and then
    we stow it into a bin. And then there’s cameras here that take
    pictures of where our hands go of where we place the item. I am a picker so I pick product that
    will end up going down to the packing department and then they pack it out
    and send it to our customers. I need to put it into a box. It actually tells me what
    type of box it is. Tape. Put the item in there. Scan it through. Drop
    it down the line. Amazon says it’s 100,000 robots inside
    the fulfillment centers help make this whole process more efficient. In 2012 Amazon bought robotics company
    Kiva for $775 million and started using robots in its fulfillment
    centers a couple years later. Now there’s driving robots that move
    inventory around, robotic arms that lift boxes and pallets and even a
    new robot that can package items in custom-sized boxes. If it wasn’t for them then I’d have to
    walk and I’d much rather be up here in my own little world picking
    then walking up and down. So I love the robots. As technology continues to change
    how fulfillment centers function, Amazon just announced it will spend $700 million
    to retrain a third of its U.S. workforce by 2025 to move
    them to more advanced jobs. After an order leaves the fulfillment center
    it has to get across the country or world to another
    warehouse in your region. Some boxes are sent via one of
    the shipping giants, but Amazon is cutting costs by sending packages in at least
    300 of its own semi-trucks and now dozens of its own planes. We’ve been building out an air network
    for a number of years now. That coupled with our partners networks, we’re in
    a place we have a lot of incremental capacity to be able to
    advance packages for customers much faster than we were two
    or three years ago. Amazon broke ground on a new 1.5 billion dollar air hub in
    Northern Kentucky in May. It has capacity for 100 planes. One of the great things about customers
    all over the world: they are divinely discontent. You give them the
    best service you can. They love it. But they always want
    a little bit more. We’re going to move Prime from two-day to
    one-day and this hub is a big part of that. After an item arrives near your city
    it waits in another warehouse like this one for a delivery person to pick it
    up and take it that last mile to your door. We’ve been building for over 20
    years to support this network that’s eventually just constantly getting faster and
    we knew would begin to migrate to a one-day service. The big difference for us is all
    about how we get product from our fulfillment center to
    that last-mile location. Last-mile is the most expensive
    part of the delivery process. Until an item arrives at a warehouse near
    your home, it can be shipped in bulk. But then each package needs to
    be hand delivered to a different address, which takes a lot of
    people and a lot of time. Amazon pays to outsource much of
    last-mile delivery to carriers like UPS and USPS, which charge a fee,
    and those fees just went up. In January the post office increased
    its last-mile shipping rate by nine to 12% depending on package size. The more Amazon can keep last-mile
    delivery in-house, the more it can control these costs. To do that Amazon uses small
    business partners, some delivering out of 20,000 Amazon vans. And in 2015 it launched Amazon Flex. I’ve been driving for Amazon Flex roughly since
    2016 on and off, I’d say at least two solid years. Amazon Flex is available
    in about 50 U.S. cities. Anyone over 21 with a
    driver’s license, auto insurance and at least a mid-size sedan can sign up. After clearing a basic background check,
    drivers in areas with open spots can start picking up
    and delivering packages. Drivers use the Flex app to sign up
    for a block, which ranges from three to six hours. Then they head to a warehouse where
    they find out how many boxes they’ve been assigned to deliver
    in that timeframe. Amazon advertises that drivers make $18
    to $25 an hour and they’re responsible for their own vehicle costs
    like gas, tolls and maintenance. Amazon wouldn’t disclose how many drivers
    have signed up or what percentage of its last-mile deliveries are
    made by Flex drivers compared to its shipping partners. But it did tell us their
    last mile delivery programs are expanding. We’ve built out these small businesses,
    the delivery service providers, and we have Flex which is
    our on-demand crowdsourced delivery piece. So we need all of that to meet the
    various types of delivery we do in each of our geographies and I think you’re
    going to see expansion on all fronts there. Amazon has one unusual approach to
    increase its number of small business partners helping with last-mile. Amazon says it will contribute as
    much as 10,000 thousand dollars if full-time employees want to leave the
    company and start their own package delivery services. Early response is great. It allows us to complement the capacity
    that we have with our great carrier partners. It’s great for some of our employees who
    don’t want to do the same thing that they’ve been doing in the warehouse
    for five or 10 years. They want to learn some new skills
    and over 16,000 employees have already taking us up on this. Amazon is also looking at several
    high-tech solutions to streamline last mile delivery. In June, Amazon announced its new
    autonomous delivery drone will be operating within months and it has a
    one year FAA permit to test them. We’re building fully electric drones that can
    fly up to 15 miles and deliver packages under five pounds to
    customers in under 30 minutes. Amazon also has patents out for a
    giant flying warehouse and drones that can react to flailing
    hands and screaming voices. And it’s even testing a sidewalk
    robot called Scout to bring packages right to your door. All these steps are an incredible
    challenge to pull off. In recent years, Amazon has faced an
    onslaught of negative press about working conditions at every
    step of the process. We spoke to several
    workers about their concerns. The working conditions at Amazon
    are dangerous and that’s systemic. I’ve worked in five different buildings
    in three different states from coast to coast and
    it’s the same everywhere. It might not be outright exploitation but
    it is almost like a disposable workforce. It’s been so pervasive that many of the
    pilots, in fact most of the pilots at our airlines are
    actively seeking employment elsewhere. Last year Amazon raised the minimum wage
    to fifteen dollars for all its 350,000 U.S. employees, more than double the
    federal minimum wage of $7.25. In his annual letter to shareholders,
    owner Jeff Bezos challenged other top retail companies to match this. And Amazon offers generous benefits. I needed my medical insurance. That’s what’s essentially kept
    me at Amazon. But some workers, most who asked
    to remain anonymous, told us Amazon expects them to keep up
    a fast, often unreasonable pace. They say that they care
    about their employees and quality. But no, it’s really
    just about numbers. You have to make not only a certain
    rate but you can’t accrue more than 30 minutes of time-off-task per day
    otherwise you get written up. Usually most buildings are at
    least a million square feet. You could be walking three to five
    minutes each way to go to bathroom. So if you went to the bathroom twice
    you could easily use up that 30 minutes. So a lot of people
    don’t go to the bathroom. CNBC was connected to Fuller through
    the Retail, Wholesale and Department Store Union. Although he’s not a union member. We asked Amazon about the
    working conditions in fulfillment centers. We have world class facilities, we
    have restrooms all over this place. We have break rooms. We have TVs. Anybody who is watching, don’t
    take my word for it. Please come take a tour
    and see for yourself. I’ll put us up
    against anybody any day. Do you feel like the pace that workers
    are asked to work out is reasonable? Well our, the way we look at
    productivity rates, just like anyone, we have expectations. In every job, my job
    has expectations, your job has the expectations. The way we set the rates
    and the processes are based on actual performance and the overwhelming majority
    of employees are able to meet those expectations. Warehouse workers told us their productivity
    is closely tracked based on how often they scan a package. Workers told us they can get written
    up if they don’t meet certain metrics. Amazon also has patents for a
    GPS-enabled wristband that could track workers’ movements and breaks. I think too often people look at
    that technology and sort of debate, is this Big Brother tracking an employee
    or something to that effect? And you know really almost all the
    time you look at these wearables or other types of things like that,
    they’re usually some form of safety device. Workers can lose their jobs if
    they don’t work fast enough. At one warehouse in Baltimore, The
    Verge reported that Amazon terminated 300 full-time associates in a one-year
    period between 2017 and 2018 for inefficiency. Amazon said in a statement
    that “the number of employee terminations have decreased over the last
    two years at our Baltimore facility as well as
    across North America.” Amazon workers are under attack. What do
    we do? Stand up, fight back. There have been several protests in the
    last few years around the world where Amazon workers have
    demanded better working conditions. In orientation they
    talked about safety. That was the number one thing. Safety. And you get
    there and that’s forgotten. In the UK, ambulances were called to
    Amazon warehouses 600 times from 2015 to 2018. In April, the National Council
    for Occupational Safety and Health identified Amazon as one of a
    “dirty dozen” companies, citing six deaths in seven months and
    13 deaths since 2013. But Amazon says that last year alone
    it spent $55 million in safety improvements at fulfillment centers and its
    employees got a million hours of safety training. As Amazon increases the shipping speed,
    can they also increase conditions to be more fair, equitable and
    sustainable as far as safety goes? Well I’m incredibly proud of the safety
    record of our sites and the focus of our leadership team on safety. Any incident is one too many and
    anytime something happens, our teams come together and figure out what happened and get
    to the root cause and try to eliminate anything from occurring
    again in the future. Amazon Air is another area where growth
    in the program has led to challenges. Amazon-branded planes are flown
    by contract pilots from Atlas Air, ABX and Southern Air. These airlines negotiate contracts
    with the pilots. And five of these pilots told
    us working conditions have deteriorated since their airlines started
    flying for Amazon. As a result of Amazon being such a
    large company, they have the ability to put a very strong pressure on our
    companies and have them drive down our pay and working conditions as pilots. Dan Wells heads up the
    union that represents these pilots. They protested outside Amazon’s annual
    shareholder meeting in May. They also spoke out in April against
    poor working conditions and low pay near the new Amazon air hub. We have a hard time
    maintaining enough qualified pilots. There’s a tremendous amount of turnover
    at these carriers which in net reduces experience and creates a lot of
    stress on things, a lot of frustration, which certainly distracts people
    from their duties as pilots. In February, an Amazon Air plane
    operated by Atlas Air crashed near Houston, killing all
    three pilots aboard. The cause of the crash is
    under investigation with initial National Transportation Safety Board findings showing
    the pilots may have lost control of the plane. In interviews with Business Insider
    weeks before, several Amazon Air pilots said they thought
    an accident was inevitable. They cited low wages that made
    it difficult to attract experienced pilots, training they considered shoddy,
    fatigue and poor morale. Pilots that are working for
    Amazon’s contractors are overwrought with schedules and scheduling changes
    and constant training. All of those things have added to
    greatly increasing the risk in the cargo system that we fly in. In a statement Amazon said, “All
    of our airline delivery providers must comply with the Amazon Supplier Code
    of Conduct and Federal Aviation Administration regulations. We take seriously any allegation that
    a delivery provider is not meeting those requirements and expectations
    and review accordingly.” Workers bringing packages that last mile to
    your door also told us safety is a concern. One reason: Amazon doesn’t provide Flex
    drivers with any branded clothing to identify them. I’m pulling up to this house and I get
    to the front door and you know this guy just comes running out like,
    “Hey what are you doing?” and he’s talking so fast and I
    was thinking you know I’m in Connecticut. You know I’m a Puerto Rican guy in
    a white guy’s yard and like, you know, what if he just comes out and
    shoots me in the face without asking questions? You know that was my fear. After another delivery where he says
    a customer let his German Shepherd charge at him, Jonathan paid 45 dollars out
    of his own pocket for a custom sweater on Etsy. I think Amazon the least they could do
    is give us something that would make it a little bit safer and make
    us more visible when we’re out there delivering. I’ve gotten a lot of mean glares
    from people because they’re like, “Who is this guy? He’s just in front of my driveway or he’s
    parked in front of my house. He’s just wearing a yellow vest.” You don’t even have to
    wear that vest. It’s just, I do it because at
    least I look less suspicious. In a statement Amazon said, “They are
    welcome to wear the safety vests that we have available for them in the
    delivery stations while they’re on their route which can help
    customers identify Flex participants.”. And some drivers told us the way
    the Flex app works encourages distracted driving because it requires drivers to
    manually tap refresh to secure their next assignment. If you want to get blocks then you
    have to be tapping on that refresh button in the app
    pretty much constantly. But how do you do
    that while you’re delivering? So it encourages people to
    do it while they’re driving. In a statement Amazon says, “Safety is our
    top priority and we are proud of our safe driving record. We regularly communicate a variety of
    safety topics including loading and driving practices with drivers. Amazon Flex participants can also sign up
    for delivery blocks up to a week in advance through the
    Amazon Flex app.” Amazon is working to ease the burden
    on its delivery drivers and save money with high-tech solutions like those drones
    and Scout sidewalk robots, and its fulfillment centers are
    becoming more automated, too. Our focus on automation has really been
    begin in automation in the places that can be most
    beneficial to the workforce. Remove the most tedious task, remove
    the heaviest lifting task, whether that be lifting large containers or
    bringing the inventory to the associate so they don’t have to
    walk through Earth’s most massive selection in order to find
    the thing they’re looking for. But for now Amazon still relies on people
    to bring us our packages in just one day. And with expectations for
    rapid delivery only growing, Amazon will need to continue innovating
    to make shipping even faster. We will see shipping
    speeds increase every day. The announcement that Amazon is going
    to one-day is ironic because in certain regions we have it
    in an hour already. That’s not going to stop. And what’s absolutely critical is any
    company that sticks their head in the sand even if it’s Amazon. We’ll see the competition
    pass them by. That’s the one guarantee
    we have in retail.

    The Business Of Amazon Shipping Boxes
    Articles, Blog

    The Business Of Amazon Shipping Boxes

    November 19, 2019


    For the past few years delivery boxes
    have been piling up on people’s doorsteps and in apartment
    buildings across the U.S. Faster delivery, easier return policies
    and free shipping have fueled growth in the
    retail e-commerce market. Amazon alone shipped over 5 billion
    packages through Prime in 2017 and in 2019 announced they are
    expanding their one-day delivery service to over 10 million products. The corrugated box is a great
    medium for transporting things because it’s durable and sturdy and from
    a damage standpoint you’re going to have less risk of that getting
    damaged in the supply chain. A corrugated box is the brown paper
    box that is used to ship roughly 95 percent of all
    products in the U.S. The corrugated boxes is probably the
    single best mousetrap to get goods from point A to point
    B, its recyclable and returnable reusable. Shipping cost Amazon $27 billion
    in 2018 which is more than double the amount it spent in 2015. That growth has been great news
    for the paper and packaging industry after the move to digital devices caused
    a drop in production of copy paper and newsprint. There’s no question that it’s, I don’t
    want to call it a salvation but it’s been a ray of sunshine
    a point of visible growth within companies where other segments of
    their business were clearly in decline. Amazon has been blamed for everything
    from the death of brick and mortar retail to the financial
    woes of the post office. But the rise of e-commerce shipping boxes
    has provided a boost to the stagnant cardboard box market. The box business now faces a
    new challenge from lighter and cheaper plastic packaging that has proliferated in
    recent years due to a transformation in the way
    packages are shipped. And as Amazon tries to cut
    down its carbon footprint the containerboard industry is bracing
    for the fallout. Which begs the question with multiple
    headwinds on the horizon will paper based cardboard boxes that have
    been used for generations and thrived in the age of e-commerce
    continue to flourish or could the cardboard box be facing
    a new challenger? Cardboard boxes are a really
    big deal in the U.S. The United States is the
    Saudi Arabia of trees. Someone’s gonna make the first box
    and that’s almost inevitably a mill generally in the
    Southeast United States. China certainly doesn’t have trees and
    India the extent they do have trees they’re not necessarily the right
    types of trees and shouldn’t be dedicated towards making
    boxes for us. The box business grew rapidly up
    through 1999 when the U.S. coordinated box market had
    its peak shipment. Starting in the early 2000s the U.S. corrugated box market faced
    multiple economic obstacles. The great recession dragged on box demand
    and even after the recession demand continued to slow for consumer
    goods like soda and for the boxes that transport them. The move to digital devices also coincided with
    a drop in demand for copy paper and newsprint. But box makers found a saving
    grace in e-commerce sales and Amazon sale specifically which were growing at
    mostly double digit rates in the recession and
    post-recession years. Those e-commerce sales have become
    a significant market for the containerboard industry. In 2018 told a U.S. e-commerce sales were estimated to be
    $512 billion almost 50 percent higher than in 2015. Amazon captured 48 percent
    of those sales. Most estimates are that e-commerce accounts
    for about 10 percent of the U.S. box market. Amazon accounts for close to
    5 percent of U.S. box demand. By our estimates they are clearly the
    single largest box user in the US. International Paper with a third
    of the market I think does closer to 50 percent of all the
    amazon boxes evidently they got a bit more share than perhaps some
    of the smaller players. Amazon said they deal with most of
    the big box makers across the U.S. according to analysts. Those manufacturers include International
    Paper, WestRock, Packaging Corporation of America
    and Georgia-Pacific. Some investors were turning to these companies
    as a way to invest in the e-commerce giant without having
    to purchase Amazon’s pricey stock. People didn’t really start talking
    about buying International Paper or WestRock as a secondary investment in
    Amazon till about the last five years. Despite the boost from e-commerce sales
    the box business still isn’t growing all that much. And since 2018 their stocks
    have mostly underperformed the S&P 500. In 2018, 69 percent of
    International Papers total revenue came from the box business and that sales
    volume has been mostly flat for the past five years. Although the big producers sold less
    boxes in 2018 than in 2000, industry consolidation has
    dramatically narrowed the fields. The handful of big players remaining
    are based in Memphis, Tennessee, Atlanta, Georgia and
    Lake Forest, Illinois. Analysts have told CNBC that
    substantial industry mergers have made it easier to collectively hike prices
    and those price increases have helped drive revenue. There are portions of the business
    that are in indisputable secular decline but if you’re in the brown
    part of the business, making these boxes, that’s been some
    very welcome growth. But those extra boxes piling up on
    people’s doorsteps have led to a backlash from disgruntled customers who
    are sick of receiving golf ball sized products
    in supersized boxes. It used to be that you’d order a
    toothbrush and it would come in three giant boxes and you’d say
    to yourself, what is this? Well, Amazon is trying to rectify that
    by using fewer boxes and using other types of
    packaging where appropriate. With e-commerce packaging underfire Amazon
    decided to change the way they do shipping. In 2008, Amazon introduced the
    Frustration Free Packaging program. It aims to reduce the extra
    packaging created when retail packaged products are placed inside Amazon
    boxes to be shipped. Instead, products certified in the program
    that are roughly the size of a blender or larger need to be
    packaged in their own ready to ship boxes. And those boxes also need to
    be made of 100 percent recyclable materials. For customers that means that
    the packaging is easy to recycle and the box is easy to
    open without all the excess packaging materials. For a year. Amazon offered vendors an incentive of
    a dollar per shipment to modify their packaging. And starting August 1st 2019 Amazon
    is charging a $1.99 penalty for each product shipped that
    needs to be reboxed. And basically the point of this deadline is
    for Amazon to get out of the business of packaging. They want their vendors to send them
    boxes that Amazon doesn’t have to touch or rebox. Amazon says that in the 10 years
    since its rolled out the program in 2008, it saved them from shipping
    out 500 million shipping boxes and reduced their packaging
    materials by 244,000 tons. Even corrugate waste that can
    be properly recycled is still a burden placed on the customer to
    tear down and properly recycle so this is just a recognition that
    we want e-commerce to be the most sustainable easiest choice
    for our customers. In those shift by Amazon have
    made the corrugated industry rethink the way it does business. International Paper said in an email to
    CNBC, “At the start of the Ecomm boom it was really
    difficult to forecast demand. There is a big focus on
    improving efficiencies through right sized packaging.” But, with Amazon using fewer and
    smaller cardboard boxes in the future that could prove to be bad
    news for the box makers. Before Amazon launched Prime in 2005
    free two-day shipping wasn’t a thing. Today it’s the norm. In an effort to reduce costs and
    ship out an ever increasing number of products faster Amazon moved to plastic
    mailers and plastic bags for many of its smaller products. If your shipping clothes that don’t need to be
    in boxes they can go in a flexible plastic mailer. As a result of which you’ve seen
    more and more products go into flexible plastic mailers. Over the past year or so it’s
    just part of Amazon’s overall effort to reduce its costs. Over the last few years we’ve recognized
    that there is a great role to play for flexible packaging of all
    types and we’ve reduced our overall corrugate and shifted many of
    our smaller items to being shipped out bound
    in flexible packaging. It’s made a pretty profound
    difference we’ve reduced substantially our use of corrugate
    box. Sealed Air a packaging company that invented bubble
    wrap in 1957 started working with Amazon in 1996 developing inflatable
    pillows for the company to ship books. The evolution of packaging for e-commerce
    it really started off quite basic. Whatever item you received you
    received it in packaging that was probably designed to ship on a
    pallet and go to a retail store. What e-commerce companies did was they
    take those items and they put it into another box. What’s evolved is you now see
    a lot more flexible packaging. There is a lot of competition
    in the mailer market in generally mailers are a low margin product. As of 2019 Sealed Air a
    leader in the protective packaging market makes food packaging, air pillows
    and automated packaging systems for e-commerce. Sealed Air had a
    revenue of $4.7 billion dollars in 2018 up modestly
    from a revenue $4.5 billion dollars in 2010. When you think about the
    challenges that e-commerce fulfillment companies face it’s really in shipping
    expense because if you give away shipping I mean someone’s paying
    for that and it typically is the e-commerce fulfillment company. There is a lot of desire to
    decrease the amount of labor, when you are able to get it, it’s
    hard to retain it and it’s expensive, automation has really been where
    we have spent a great deal of our time investing. Around 2010, Amazon started using
    Jiffy padded envelopes with Kraft paper on the outside in
    plastic bubbles on the inside. Over the last two years we
    have invented two different kinds of flexible mailers. One is the blue and
    white all plastic mailer. We’ve recently launched in the last
    six, eight months a paper padded mailer that’s actually fully recyclable
    with the paper stream. Amazon said they made about 10
    million shipments using the paper padded mailer and depending on the
    month the plastic mailer is used about 20 to 30 percent of the time. So really when we come down to deciding
    if the product is of the size it can go on a mailer, it’s not
    likely to be damaged by going in the mailer, the mailer is always the
    better fitting option and frankly is easier for the customer to choose
    to recycle than breaking down a corrugate box. We’re driving in that direction
    for many different reasons. But those plastic mailers generally are
    not accepted in municipal recycling programs and you’ll need to
    bring them to a store that accepts plastic bags. Many cities have film recycling
    and take back programs through stores then that plastic
    mailer makes sense but we’ve basically moved away from a
    non-recyclable to two recyclable options. Plastic mailers have some
    benefits for the environment. A corrugated box uses 23 times more
    energy and produces six times more CO2 than a bubble
    mailer to manufacture. Plastic mailers take up less space in
    containers and trucks making shipping more efficient. But in the paper versus
    plastic debate not everyone agrees. Environmentalists argue in practice the
    plastic mailers aren’t better for the environment. They say these products need to
    be recycled separately from other plastics and they aren’t
    recyclable in curbside bins. Two huge barriers to recycling. The latest stats from the EPA show
    that corrugated boxes were recycled at a rate of 92 percent in 2015
    while plastic bags, sacks and wraps were recycled at a rate of
    13 percent in 2015. When you think about what is the
    greatest pain point for the consumer after having it get there safely
    arrive on time people are concerned about receiving something that is plastic
    or made a poly because of the environmental concerns. Some waste management companies say
    plastic packaging also causes problems for the recycling systems. Plastic mailers get caught in
    the recycling machinery slowing down the process and raising the
    costs for recyclers and sometimes contaminating entire bundles. Until Scotty on the Enterprise can
    beam the products from the warehouse to your living room I think
    Amazon’s gonna be good for the corrugated business. I think there’s going to be
    noise I think you’re gonna have challenges from time to time where people
    say, “Should we try and the plastic pouch?”, in the long run plastic is gonna
    be on the wrong side of history. Because Amazon is a
    market leader in the U.S. e-commerce sector any move away
    from cardboard to plastic mailers could signal a shift
    for the entire industry. The corrugated box could be about
    to undergo a major facelift. We’re seeing some major trends
    among consumers and what they’re expecting from e-commerce and the first
    one is actually this desire for increased engagement
    with the package. In 2015, Amazon partnered with
    Universal Pictures and Illumination Entertainment to ship orders in
    bright yellow delivery boxes featuring cartoon characters from
    the movie Minions. The boxes promoting the movie
    and a special Amazon U.R.L. dedicated to shopping for
    merchandise from the film. If a millennial is going to look at
    it and it’s gonna be an Instagram moment then we need to be thinking
    about what can we do with the package to help foster that. At Amazon an engineering team is
    working on redesigning the cardboard box. In 2018, using computational engineering
    they began to test the stress and strains and vibration effects
    of packages as the moving trucks across the country. We’ve optimized the weight of the
    corrugate box and reduced the overall weight of our boxes
    by about 9 percent. And we’ve reduced the size of our box
    meaning making them fit better and our customers are seeing in some cases
    much of an 18 to 20 percent reduction in the weight
    of the recycled corrugate waste that they would have
    seen coming into their home. While items like clothing and diapers
    can ship in a plastic flexible mailer, electronics and easily damaged
    goods will still need the protection offered by
    a corrugated box. Despite headwinds in the economy
    and inroads from plastic mailers demand for cardboard boxes from
    Amazon continues to remain high. Even though Amazon is using some
    smaller boxes, the four companies that I mentioned have not been
    talking about less demand from Amazon they’re talking about more
    demand from Amazon. And if it’s smarter demand from Amazon
    I still think they’re to get paid for that. With U.S. online retail sales expected to
    surpass a trillion dollars by 2025, double the amount it reached
    in 2018, the market for e-commerce packaging could increase rapidly in
    the coming years despite Amazon’s effort to cut down
    its shipping footprint. E-commerce packaging which includes corrugated packaging
    as well as flexible packaging will grow at about 14
    percent every year from 2017 through 2022 reaching almost $55
    billion in 2022. That growth could deliver sizable
    returns for the cardboard box makers and we’re likely to see
    even more boxes and plastic mailers piled outside of people’s
    homes in the future.

    Why Today’s Market Is Unique But Signals a Coming Recession (w/ Tony Greer and Nick Sofocleous)
    Articles, Blog

    Why Today’s Market Is Unique But Signals a Coming Recession (w/ Tony Greer and Nick Sofocleous)

    November 5, 2019


    TONY GREER: I was hesitant to bring you out
    here on camera because I like to have my closest confidant in the stock market to myself, or
    at least as to myself since I can get you. Nick, I want to thank you. You’re one of the guys that I don’t make a
    major move in my portfolio unless I check with Nick. I don’t put on a size position unless I have
    spoken with Nick in the last 24 hours. And that has to do with your experience in
    the markets. I want to thank you for coming down today
    and sharing this with us, man. NICK SOFOCLEOUS: Well, thanks very much for
    having me. It’s a pleasure to be here. TONY GREER: Yeah. So, let’s start right at the beginning. August of 1987, when you got your start in
    the markets. Take it away from there, man. The S&P at 340. Gold under 500. And US 10 Year Yields at 9%. NICK SOFOCLEOUS: So, yeah, fun times in in
    London. So, teenager, coming out of school. TONY GREER: How old? NICK SOFOCLEOUS: 17. TONY GREER: 17, right onto a desk. NICK SOFOCLEOUS: Yeah, well, not quite but
    close. But as close as you can get. And it wasn’t on a desk and you weren’t on
    the phones because there weren’t enough phones for everybody. You weren’t in front of screens, because there
    weren’t enough screens for everybody. So, you had to work your way up. And that was post-Big Bang in London. There was some real jobs and real people in
    London in those mid80s. TONY GREER: And you get started right in the
    buy side, correct? NICK SOFOCLEOUS: I did get started on the
    buy side. I was very lucky. And there was some people that decided to
    take a bit of a punt from someone that was fairly good with numbers. That happened to be me. Yeah, it was a really fun time. The 25th of August 1987 was peak market, pre-crash
    of October ’87. I knew absolutely nothing. And everybody around me was busy. And they were busy learning. They were busy trading, they were busy assets-allocating. And then after August of ’87, in October of
    ’87, we came up with a bit of a crash. And those days were amazing. Because when you know nothing, you learn everything. So, through the days in London, there was
    the hurricanes in ’87. Lloyds of London was basically was touching
    go whether they were going to be around, they had massive losses, the crash of ’87 in the
    US stock market. And there was one particular day, I remember
    it. I turned around to a colleague of mine, really
    senior, great, great asset manager. And I turned at him and said, so, yesterday
    we were buying, but today we’re not. Can you explain that? And he politely asked me to sit down and mind
    my own business for a minute. TONY GREER: Stay out of the way for a bit. NICK SOFOCLEOUS: That’s right. That was right. So, it was ’87. TONY GREER: So now, you’re in the middle of
    the firing lines, there is a market crash that takes the S&P down 22% or so and we probably
    wallowed around those levels for the next year or two before I guess the S&P broke out
    again in 1990. But what stuck with you from back then? What lessons did you pull away from being
    in such a volatile market with such little education at the time? Because I know all of that gets flipped on
    its head to where we are today. NICK SOFOCLEOUS: Right. That’s really interesting. What do you learn from ’87? You learn from really smart people in ’87
    to keep calm that if you can keep your head while all about are losing theirs, you’re
    going to be just fine. And that’s really difficult to do in high
    volatility environments. But that’s what I learned from ’87. TONY GREER: That’s a very good point. So, from there, you started making observations
    on markets, taking it very seriously and picking up some tools into your toolkit as you grow
    as a trader. So, into the early ’90s, we kicked the decade
    off with a war in the Gulf, we start moving into the very, very beginning of the internet
    boom, the infancy stages, I would say in the early ’90s, ’92, ’93. Tell me about your experience on the buy side
    as a young, now, someone in your early 20s going into that experience. NICK SOFOCLEOUS: So, 1990, you’ve got Gulf
    War I. And the experience from ’87 takes you into
    Gulf War I. Because when we started to rise in volatility
    in 1990, you could turn around today and say I’ve seen worse. So, all of a sudden, you weren’t panicking
    anywhere near as much as you were in ’87. Fast forward into now, you’re catching a bit
    of a wave of a bull market from ’91 through two, three and into ’94. So, now you’re into ’94. And you start getting an IPO calendar that
    is taking flight. So, every day, every week, you’ve got these
    red herrings coming through the post, and you’re having to read these red herrings,
    there’s no email, and you’re placing orders to buy these IPOs. And every day, there’s more IPOs. Now, history has told you if you could sit
    through ’87, through 1990 and ’91, you were in a bonanza situation in ’94 and into ’95. Fast forward, you start getting into the Fed
    cheap money, Greenspan doing everything that he can do to calm everybody. Then Greenspan turns around and says irrational
    exuberance. And you think the bubble is burst? Far from it. TONY GREER: Yeah, exactly. So, we keep going. NICK SOFOCLEOUS: And we keep going. We’re into 97- TONY GREER: Amazon is delivering
    everything to your house already. Starting with books and CDs, but we’re getting
    there. NICK SOFOCLEOUS: Right. But then the real trades are, if you can hang
    on to the bull market in the US, your real trades are being driven by currencies and
    being driven by rates. So, with Russia having its troubles in ’97,
    the US didn’t care, as in the US stock market really didn’t care. Fast forward, ’98 and LTCM blows up. So, the lesson of ’97 into ’98 is as much
    as you think it matters in Russia, it doesn’t matter until it’s on your doorstep. And your doorstep was LTCM in ’98, which was
    another episode of if you can keep your head while all about are losing theirs, you were
    in great shape. Because then you rode late ’98 into ’99 into
    early 2000s. TONY GREER: So now, were you actively- do
    you recall yourself thinking about your first days as a trader and the stock market sort
    of crashing back then, back in October of ’87? Are you worrying about this the whole time? Are you seizing your opportunities on all
    the tips and stuff? NICK SOFOCLEOUS: It’s so funny you should
    say that, that’s so true. In your first experiences, you always think
    they’re going to be replicated very soon. And it’s good to have that as a mental record. But it’s fatal for being able to trade correctly,
    because you miss your opportunities. And that’s when you try to gauge when you
    have opportunities. Are you in a bull cycle? Are you in a bear cycle? Are asset prices going up? Are asset prices basically going down? By the way, asset prices going down might
    mean asset prices are just flat, which is what we have now. TONY GREER: So, the markets are rallying ferociously
    into ’98, ’99, toward the dot-com bubble, which we haven’t gotten to yet. But in 1999, I know you made a tremendous
    life decision to change time zones, life centers, and everything. Tell me what was that about? How did you pick yourself up from being so
    entrenched in the markets in London and saying, okay, we’re going overseas? NICK SOFOCLEOUS: Yeah, that’s interesting. So, early ’99, I get a call from the company
    in New York, Sanford Bernstein. And they basically asked me, do you want an
    adventure, and I thought to myself, I’ve traded US now for ’99- probably eight years. I’ve been observant of the market now for
    12. If you want to be in the lion’s den for US
    equity trading, you have to be in New York. So, I said, I’d love to be part of that adventure,
    they were kind enough to say we’d love to have you. And off I came from London to New York. Now, the interesting thing about moving countries-
    and a lot of your viewers will see this, a lot of people will understand what I’m saying
    is it’s damn difficult. TONY GREER: I can imagine. NICK SOFOCLEOUS: It’s damn difficult. So, the people that you thought that you knew
    well in a city of any time, could be 24 million people, you can note that 12 million here,
    24 in the tri-state area, you actually don’t know anyone, it can be the loneliest experience. So, what that teaches you is take everything
    one step at a time, don’t cross bridges you don’t need to cross until you’re asked to
    cross them. Because there’s too much to take on board. It’s a big city, you’re being asked to be
    a professional in a professional firm, in a professional setting, where quite frankly,
    you’re the underdog. And you have to understand you’re the underdog. And you have to fight again and again, not
    only with the market, but with the people that are in New York, it’s you- you almost
    feel it’s you versus the world. But you can’t take on the world at once, you
    have to do it one step at a time. It was a huge life lesson. It’s one step at a time. Trying to do anything well take steps. And that was a huge lesson for me. TONY GREER: Well, I would imagine it was a
    huge challenge, both shifting sides of the pond, but you’re also shifting sides of the
    business, from the buy side to the sell side. You’re going from making decisions that affect
    the portfolio to make sure that you’re making money, or at least protecting yourself to
    now, establishing client relationships, figuring out how to protect your clients, figuring
    out how to educate them. Were you ready to go on the sell side with
    your sort of bag of market tricks? Or was it very much a process of saying, oh,
    this is a totally different job now, I’ve got to really learn everything from scratch. What was it for you? NICK SOFOCLEOUS: No, it wasn’t relearn everything. What you did is you took your information
    that you’ve gathered in previous years, you took your personal stats that you looked at
    on your screens that you made yourself, because they worked for you in how you looked at things,
    and then you applied it to the job at hand. And what you tried to do in those days, and
    it’s the same for today, is help. You try to help. You try to use that information to help so
    that other people could maybe be successful using your tools. They may not find those tools to be helpful
    at all. But invariably, they did. And invariably, they became as successful
    as they wanted to be. And you were part of that success, which was
    tremendous. TONY GREER: Yes, I know. I have some remembrances of that from being
    on the sell side on a sort of later date. But it was very rewarding to be able to say,
    look, this is what I’ve learned in the markets, you guys have got to look at this and to point
    out a blind spot to somebody and have them say, oh, that was really helpful. You have got a seemingly endless number of
    market tools that you use to look at to formulate your views. When you and I speak on the phone, there’s
    a sort of recurrence of let’s look at this again. And let’s look at this again. And where are we in cyclical versus non-cyclical? And what just happened in the tick index? And what has gone on with green to red days
    or red to green days? Can you tell me how that became part of your
    vernacular in any way? NICK SOFOCLEOUS: Yeah. It’s amazing, really. Because when you’re in a bull market, when
    your growths are going bottom left, top right. And you’ve missed the first move. How do you get in? You know you’re in a bull market, how do you
    get in? So, I’ve tried to figure out how there were
    these consecutive down days. And this all took me- I don’t know- probably
    took me two or three years to understand that when you had consecutive down days, sometimes
    at the end of that, it was the right time to buy, but nobody could tell me why it was
    the right time to buy. Why would they have these consecutive down
    days? Why were there three or four or five? Or in the crash, there was eight? Or nine? Why would they be this amount? And what was the difference between why there
    was three, or five? So, if I bought on the end day of the third
    consecutive down day, why did it go down on day four? Was I wrong on day three? If I was wrong, day three, why was I wrong
    on day three? So, I needed something that gave me an indicator
    of that’s a waterfall, that’s everybody selling at the same time, so that I could then go,
    I will take the other side to that trade, because I know that that usually marks somewhere
    near the zenith of a move. So, I found this index, the tick index, and
    it is the amount of stocks that have just moved higher than the last price versus lower
    than the last price. And then I had to find a number that equated
    to the bottom of the waterfall. TONY GREER: When was the selling the most
    intense? NICK SOFOCLEOUS: Right. Whatever was holding the market up, when did
    that go? When did the floor fall out? And if I was bullish, I wanted to catch the
    bottom of the waterfall. I didn’t want to catch everything going down. That’s a falling knife. Neither did I want to wait to see if it worked
    out sometime later. Because then, all of a sudden, you don’t get
    that wonderful V and your great entry points. TONY GREER: At the bottom, they’re near the
    bottom. NICK SOFOCLEOUS: That’s right. So, the tick index was something that I looked
    at, and when I might be able to use that. And then it was a case of what’s the number? What’s the negative number of that? TONY GREER: How intense of a reading do you
    have to get on the downside or the upside, obviously, but we’re talking about getting
    in on a waterfall. So, I’m assuming it’s down. NICK SOFOCLEOUS: Absolutely right. That took me another three years to figure
    out because I was using 1000, negative thousand. And then I would find that there was too many
    days that you’d had negative 1000. And it wasn’t timing anything. TONY GREER: They weren’t determinable? NICK SOFOCLEOUS: No. It was just noise. So, then I went to 1100. And then I had to wait for the days to see
    if 1100 worked. 1100 didn’t work. So, then I went to negative 1200 going look,
    at some point, I’m going to get the number. 1200 didn’t work. And then I had to wait for another set of
    days. And by the way, you only get three consecutive
    down days about 15 times a year. You only get four, therefore, eight, five,
    six and you’re at seven, eight, nine. You just read, you don’t see a lot of. So, always having to wait to prove whether
    this was right, or this was wrong. So, I came up with this number 1300. And I remember the first time it worked and
    within a bull market. And as soon as it worked and as soon as we
    bounced, a light bulb went off. It was an utter light bulb moment. And then it had to be proven. And I was in a bull market. So, the cardsTONY GREER: You’re getting the
    chances to prove it. NICK SOFOCLEOUS: The cards were stacked in
    my favor. And I knew that, so that you did want to buy. So, you had the most important function of
    I want to be a buyer, now, was a function of trying to find where I could get as close
    to an entry point as I wouldn’t get stopped out. I found this negative 1300. I also had a rule of it had to be three consecutive
    down days. NowTONY GREER: Discipline is being applied. That’s all. NICK SOFOCLEOUS: That’s what I’m doing. There’s going to be days when you have negative
    1300 ticks and you go, what just happened? But that’s not an entry point. That’s a place to ask a question. I ended up finding this negative 1300 tick
    on at least the third consecutive down day. And during a bull market, it’s bulletproof. Now subsequently, I’ve learned that something
    gets triggered within the market to pull some either strategies that otherwise would be
    applied, they’re not allowed to be applied. Because you see the whole screen go slower. It’s like a go slow market as soon as you
    hit that negative 1300 tick in a bull market. The last 18 months, we’ve seen this. On October last year, we saw that that negative
    1300 tick was applied, was triggered. And then we had negative 1400. TONY GREER: That’s where we had several days
    below that. Reading the mood, eight or 10. NICK SOFOCLEOUS: Now, this is where it gets
    interesting. You say, well, that rule applies. Surely. Yes, in a bull market. Totally. So, why did it break? Well, because we broke the market in October,
    and it manifested in December. That was brilliant information from the first
    week of October for me. And I looked at it and went, we got a broken
    market and discussed it with you, discussed it with friends, discussed it with other market
    participants. And then we get to Christmas Eve. And you go, wait a minute, we’re doing something
    very strange here. What all we’re doing is going down, going
    down, there’s going to be a divergence and sure is X is X, Christmas Eve boxing day we
    got that divergence. And you knew at that point, with that divergence,
    with those amount of panics that something somewhere wasn’t right. TONY GREER: Don’t fade the Fed, immediately
    jumped in your face when Steven Mnuchin reached out to six banks. We don’t want to fight the Fed after a 500-point
    slide either. NICK SOFOCLEOUS: If you learn anything from
    2008, when the Fed are involved in walking up the steps of the Capitol, you owe phone
    calls to liquidity providers. Yeah, you don’t want to fight back. And, look, we all do because we all go, this
    is a bigger problem. But it’s not a bigger problem until it gets
    to be a bigger problem. TONY GREER: That’s what’s been so interesting
    in why I wanted to get you in here approximately 10 years since the day I met you, roughly. Now, if we look at that, that has been over
    the recent 10 Year bull market, the recent 10 Year recovery. But what was so amazing about calling Nick
    up on the phone when the market would dip, I would call you up and be like, is this the
    one or what? And you would give me the parameters. No, we haven’t got the 13. And then you’d say you call me back after
    two or three down days, we’d get the tick. And you’d be like that was it. That’s what we were looking for. That was it right there with 100% certainty. And it’s because you tried the theory over
    the last 20 years. And because you knew where we were, but I
    think mainly because you had identified the type of bull market that we were in, which
    was going to be at that point from ’09 to call it ’15 was essentially a Fed QE-driven
    market. And you knew we were in a bull market. So, you got the tick readings. And every time I spoke to you, it was like,
    yep, this is the reading right here, boom, let’s go, we’re going back up. And to guys like me, who are looking and seeing
    things break down below moving averages, and you’re starting to see oscillators just starting
    to curl over and things like that. I’m a momentum guy so I’m looking for this
    to continue. And you saved me about 100 times in the last
    10 years, saying, nah, this isn’t the one because we’re still within the context of
    this bull market. And that was a really educational experience
    for me. NICK SOFOCLEOUS: So, we’ve had plenty of discussions. But when people say to me, the bull market
    started on March 9 th, 2009, I’m like did it really? Okay, prices went- that was the closing the
    low of the S&P. Okay. But does that mean that 1972 was the start
    of the bull market in the ’70s? I don’t know anybody that lived in the ’70s
    that thought they were living in an equity bull market bearing in mind that Baron’s had
    the end of equities in 1982. Because nobody was in a bull market in the
    ’70s when it came to equities, you’re in a commodity bull market. So, fast forward to 2009, I can apply the
    same action from March 2009 as 1972 when you read some of the articles written in 1972. And you say, well, was it really the start
    of the bull market? And my answer to that is I don’t think it
    was. So, then someone will ask, well, when was
    the start of the bull market? And I will say it’s the fourth of October
    2011. TONY GREER: Why that date? NICK SOFOCLEOUS: So, we’ve gone through 2010,
    2011 QE forever. We just had the debt downgrade in the July
    into the August. So, August, I think was August 3 rd , 4th,
    it was the Friday that we had the debt downgrade. And none of us knew what was going to happen. None of us knew what was going to happen to
    Treasuries. Now, Treasuries became bid only. And they just got downgraded. Amazing. But you do have something then that’s on your
    doorstep again. It’s LTCM. So, you go back and take your LTCM playbook
    and go, what happened then? It’s now one of those debt. We didn’t care of a debt downgrade in European
    sovereigns. Didn’t matter to us. We were like, oh, that’s a shame. Doesn’t matter. It’s not on our doorstep. Now, it’s on our doorstep. What do we do? LTCM was on our doorstep. What did we do? And then you look for times when you start
    discounting bad news, which is what you said earlier about the trade from red to green. You get a really bad jobs number on the fourth
    of October 2011. It was a stinker. And we went down to 1075 intraday, and it
    was awful. And everybody threw their toys out the pram,
    and then we started to rally. And then your ears perk up and your eyes become
    glued to the screens. And all of a sudden, you’re green, at the
    end of the day, on the worst non-pharm payroll print, you can imagine. TONY GREER: Right, that’s the signal. NICK SOFOCLEOUS: At that point you go, we’ve
    just discounted bad news. TONY GREER: That’s it. NICK SOFOCLEOUS: That’s it. TONY GREER: That’s your ego moment. NICK SOFOCLEOUS: The cycle, at that point,
    for me, was the yield curve. Because it had done everything you should
    have done. TONY GREER: Flat like a pancake. NICK SOFOCLEOUS: Well, it had steepened all
    the way from 2009, all the way into 2011. You’d steepened it dramatically. You’d cut rates, you’d had QE forever, that
    was still ongoing, rates were at zero. And then all of a sudden, you had 225 basis
    points of curve. And if you want to look at anything, 225 basis
    points of curve, somebody is going to get reflated. TONY GREER: And that’s what happened. NICK SOFOCLEOUS: And that’s what happened. And so, all of a sudden, if you can reflate
    your financial system, which is they were quite successful in doing it, whether we like
    it or whether we don’t, they were quite successful in doing it. And then you had the curves on your side,
    financial systems on your side, Fed’s on your side, who are you fighting against? And invariably, you’re fighting against yourself. TONY GREER: We know that answer. Because it’s very difficult to pay a new high,
    it’s very difficult. NICK SOFOCLEOUS: It’s very difficult. Until you do, and you get rewarded for it. And you go you know what? Nicely done. Because nobody gets the first trade consistently. You can go like, you know what? I just missed that. I’ve missed that one. But if I’m thinking about this correctly,
    I’m going to be okay getting involved. TONY GREER: There’s the lesson that you taught
    me ultimately, is that you don’t have to be afraid if you miss the first five minutes
    of a bull market, correct? You don’t have to be afraid because it’s going
    to have nine innings and there are going to be nine innings that you can make money in. And if we play it all right and we stick to
    our guidelines and stick to our discipline, it’s okay to miss the first five. That’s why when all these other markets have
    sprung to life, like crypto and cannabis, I just got very patient. And we’re able to say, all right, we’re going
    to get a chance to get in here. We’ll get a chance, we’re going to wait for
    everybody to throw the towel in. NICK SOFOCLEOUS: Applying all of those lessons. TONY GREER: Yeah. It’s just deciding are going to be bullish
    crypto and cannabis, or we’re going to be bearish? And we decided to be bullish, we applied those
    lessons and have had a number of opportunities. So, that’s why I feel like that is the most
    valuable trading lesson that you’ve taught me. And I’ve been in off for 10 years about it. So, but like you said, things started to change
    October last year into December. Let’s get up to speed now and talk about where
    the markets are versus where they are in the Fed. NICK SOFOCLEOUS: So, there’s a couple of things
    that in the last 18 months, that you can just look at, and it could be price appreciation,
    the global growth momentum going into the start of 2018. And people forget how great January 2018 was,
    we were almost parabolic. Almost parabolic. And at that point, I was like, oh, these are
    usually the ends of moves not start of moves. This is when everybody’s in the same boat
    and on the same side of the boat. TONY GREER: Right. And that can continue for a period but still
    worth making note over. NICK SOFOCLEOUS: Yeah. And then for some reason, still tricky to
    discern. We hit a bit of a speed bump in that February,
    we blew up the VIX ETN. And then we rebounded. And then through the summer, the broader market
    was rebounding. But for me, we weren’t being led by those
    wonderful cyclicals. In a great bull market, you want to be led
    by the cyclicals. Those are the high growth earners where you
    are going to be well rewarded. TONY GREER: That gives you confidence that
    there’s going to be more to follow. NICK SOFOCLEOUS: That’s absolutely right. So, we started being led by some safer havens. The more that we were going up, the more we
    were being led by the safer havens. And the more cyclicals were being left in
    the dust. So, all of a sudden, the hairs on the back
    of your neck go up. And you go, wait a minute, what’s happening? And you couldn’t really figure it out. Couldn’t really figure it out. The Fed were raising rates, the numbers were
    ok. But if your GDP numbers are okay and your
    growth numbers are okay and your PMIs are okay, why aren’t the cyclicals running? Fast forward into September, and we start
    dislocating some currencies, and we start dislocating some bond markets because they’re
    pricing for cuts, because they see something around the globe that isn’t global growth. So, all of a suddenTONY GREER: First time? NICK SOFOCLEOUS: For first time in eight years. First time in eight years, they don’t see
    global growth. They don’t see global growth, bond market
    starts to sniff out a Fed cut. And yet, the Fed are like, no, we’re going
    to raise. Then we get a very decent PMI in August, September-
    probably the first week of September. And the bond market dislocates. 10s go from 280 up through 3%. And quickly go up to 320. Now, there’s no problem with having 10 Year
    paper trading from 280 to 320. If I told you that was over the next 25 years,
    you’d be like it’s not a problem. Going 280 from 320 in three weeks, yeah, you
    have a velocity issue. You’re going to have a problem somewhere with
    volatility. And you’re going to have a problem somewhere
    with equities. And that’s what we found in October, all of
    a sudden, something broke in October. No one’s entirely sure what it was. But we could see it. TONY GREER: Yep. We had the trigger of Khashoggi disappearing
    and oil coming apart. That was one slight trigger that started. NICK SOFOCLEOUS: Entirely plausible. TONY GREER: Yeah. Just an idea. Maybe it wasn’t, maybe it was, who knows,
    but the timing is similar. NICK SOFOCLEOUS: It’s all part of the tapestry. It just stitch. And you will have your triggers that are on
    your screens and I will have my triggers that are on my screens. And all of a sudden, we might come to the
    same conclusion. But looking at different things. And when that happens you’ve got something. It’s always the same. Somebody comes from the left, you come from
    the right, you come to the same conclusion. And you go, can you talk me through how you
    got there? And I’ll talk you through how I got there. And that’s where we find ourselves. TONY GREER: That’s where we find ourselves. And we find ourselves I think, in an increasingly
    uncertain position due to the President. For the first time, we’ve got a White House
    that is barking like a dog at the Fed Chairman, floating stories about trying to decide whether
    or not they can legally remove the Fed Chairman. It’s a new paradigm, and it has become the
    focus of the markets. How’s the White House and the Fed are interacting? Are they getting along? Is Powell going to listen? Is Trump going to win? What’s going to happen? Clearly, the markets have won over a lot of
    fans into thinking that the President is really going to have a serious control over the Fed. We just went from pricing in four rate hikes
    to pricing in three rate cuts in a year. And I feel like the Fed is compromised now. But what do you think? NICK SOFOCLEOUS: It’s entirely plausible. I think that this is an environment where
    none of us have seen. I think it’s an environment where history
    doesn’t teach us too much. And you really don’t want to jump the gun
    and say, the current environment reminds you of early ’70s with Nixon and his then Fed
    chair. I’m not entirely sure that I’m in that camp. I think- and this is, again, this is new for
    everybody. I do believe that the Fed don’t have a choice
    in cutting rates. I think that the market was ahead of itself
    last September, got caught offside, the dark plots of the Fed just came down by 50 basis
    points for the end of 2020. These are facts, these are- we know. TONY GREER: Known knowns. NICK SOFOCLEOUS: I think when you’re dealing
    with the White House, you have to take the information, try to distill what your screens
    are reacting to. And once you are able to distill that, which
    is very difficult, and none of us know the answers because this is a different White
    House. It’s a different Fed chair. This is not Janet Yellen. It’s not Alan Greenspan. It’s not Ben Bernanke. You were able to understand the environment
    that they were working in. This environment is different. The White House has made this environment
    a little bit different. Powell is a different man entirely. I did have a bit of an issue with how easy
    it looks to him in late 2018. I was like, it’s never that easy. If it was that easy, this would have been
    done already. TONY GREER: He was a hot beaming with confidence. NICK SOFOCLEOUS: Seemed it. TONY GREER: And they’re coming, we’re going
    to raise rates, we’re going to do what the country deserves kind of thing. NICK SOFOCLEOUS: We’re on autopilot. I don’t know about you, but autopilot- not
    the best of strategies when you’re the Fed chair. We’ve basically got a Fed that is going to
    cut rates. If they don’t, there will be a dislocation
    shock. And that is again on our doorstep. I think the market’s pricing at 160 in end
    of 2020. And at the moment, the Fed is significantly
    above that. To tank. So, you’ve got a real issue. 10 Year papers trading at what, two or three
    today? TONY GREER: Give or take. NICK SOFOCLEOUS: Right. The curve’s at 25 basis points, give or take. And there’s no doubt in my mind that that
    curve has to steepen. There’s no doubt in my mind. And the trouble with a bull steepening curve
    is you can count the days ’til you have a dislocating equity market. TONY GREER: Really? You think so? NICK SOFOCLEOUS: Yeah. TONY GREER: Or do you think we’re going to
    have strong data that comes out? NICK SOFOCLEOUS: No, I think we’re going to
    have- Okay, this is that’s really interesting, strong data, as opposed to what? Weak data? TONY GREER: Yeah, I’m just thinking strong
    data potentially dislocating the bond market lower. NICK SOFOCLEOUS: Right. So, manufacturing data right now is appalling. It’s terrible. Consumer data is very good. The unemployment data is very good. Consumer confidence is very good. The homebuilders index seems to be fine. New Home Sales seem to be fine. And as do with the consumer, she was not massively
    levered. The balance sheets look pretty fine. That’s terrific. And then you look at the manufacturing data,
    and you go, this is tricky. This looks really bad. It looks a bit like 2050 when we had the earnings
    recession driven by energy of which you know only too well. So, then you end up with, so what data am
    I looking at? Am I looking at the manufacturing data? Or am I looking at the consumer data? Because the consumer data is okay, but the
    manufacturing data stinks. TONY GREER: How do we work out of it? NICK SOFOCLEOUS: How do we work out of it? I don’t know, I really don’t know. You don’t ever want bad things to happen. Nobody wakes up in the morning and go, you
    know what? I really hope today bad things are going to
    happen. But at this point, we’re going to have to
    manage our way through softer manufacturing data and okay consumer data. And what you don’t want to see is more of
    the White House, more of China, more of the tariff, more of the trade talks, more of that
    uptick in rhetoric affecting the consumer data, because it’s already affected the manufacturing
    data. Now, it might not only be that there might
    be several other estimates. TONY GREER: Nobody. Those are fair observations. NICK SOFOCLEOUS: This is where it triggers. So, does a weaker manufacturing data trigger
    some weaker consumer data? Or does the consumer data, being very good,
    help to mitigate and pull up some of the manufacturing data? And I don’t have an answer to that. And I’m trying to find those answers every
    day, I’m trying to find has the market sniffed out that the consumer data is going to help
    the manufacturing data? At the moment, all of those cyclical cross
    currencies are not saying that’s the case. TONY GREER: Right, that’s true. NICK SOFOCLEOUS: The Chinese data, the base
    metals are not saying that’s the case. Crypto, for interests of knowledge is not
    saying that is the case. You want copper to trade well. You want China to trade well, but China goes
    up because they stimulate. China goes up because they’re issuing credit. And you go, okay, I understand that you need
    to do that. But that’s really not a fully-fledged bull
    market. Then you go back to, okay, what did 2009 teach
    me? It taught me it wasn’t a fully-fledged bull
    market. What did 2007 teach me? Well, it taught you that we were all offside
    all the way up into basically October of 2007. Because we were like, there is trouble. But the market kept going up. Now, what happened in 2008 is you could look
    at 2007 and say, I told you so. Well, great. Good for you. How do you trade it? You have to be really careful. If you want to trade that on the long side,
    you know that your trades are shallow. If you want to trade it on the short side,
    now, it’s going to cost you money. Because every now and again, you’re going
    to get a short squeeze. And that is going to hurt. And I do find that right now in 2019. Just fast forward into 2019. That’s where we’re at. Those short squeezes can be brutal. And the leadership is less than stellar. TONY GREER: Panic buying into highs on steep
    high magnitude game days, likeNICK SOFOCLEOUS: Right, and the one great sector right now
    is software. There’s data galore saying people are buying
    software for productivity gains. Terrific. But at some point, you start pricing that
    as well today, little bit weaker on software. A lot of people asking questions, no normal
    answers. What did the market do? Market really didn’t do too much. It was a few ups, a few downs. Oil was okay. Gold was at 1420. I know what caught my eye. A little bit bad on software, a little bit
    better in gold and precious metals. TONY GREER: Right. Well, let’s speak to that right now. Gold’s clearly staging a potential breakout. Technically speaking, we haven’t been above
    1400 in about three or four years. It’s obviously a direct reaction, in my opinion,
    to the negative yield pool starting to expand again into the 12 and 13 trillion area. What are your thoughts on gold? Do you think gold has legs this time or? NICK SOFOCLEOUS: So, I was lucky. Like you, I played the precious metal trade
    from 2009 throughactually, into 2011 when I found that equities were going to be a little
    bit better for me. Thankfully, you don’t have to catch the bottom. You don’t have to trade the top. But there’s an awful lot of things that look
    similar in regards to why you would own precious metals, you’ve got interest rates that are
    going lower. You got manufacturing that’s down. Your only numbers that aren’t deteriorating
    are in the consumer. Well, gold doesn’t care about the consumer. Gold is, for want of a better word, a store
    of value. You might not like that value and you might
    not agree with what that value is, you might think that value is lower. That’s okay. But it’s still a store of value to many. For me, it’s a ticker symbol on the screen. And if it trades well, I can get my head around
    why it’s trading well, that’s fine. That’s fine. I don’t have to marry it. But I do have to own it. There’s always a bull market somewhere. You just need to be able to see it, and you
    need to be able to play it. TONY GREER: That is a great point. That’s a great point. And with 30 years, or 30 years plus of your
    history, I have a lot of respect for you saying coming into the situation right now and saying
    totally different, something we haven’t seen before. That’s to me a sign that your eyes are wide
    open, and that this is a very different paradigm. And then you’re not willing to just go back
    and compare it to something that happened 20 or 30 years ago, because to me, that was
    a scary comparisons as well, because the world is so much different. NICK SOFOCLEOUS: I would be very interested
    to have been around during something like the Cuban Missile Crisis. Where every day you woke up to a headline
    going, we’re three minutes away from pressing big red buttons. Right, good grief. That and all we can do is read about those
    occasions. But it does seem to me as though as much as
    we think this is a really bad situation, it’s 2019, it’s not the early ’60s. We’re not quite there. So, as much as people say, this is terrible. This is a disaster for the country. I think some of those comments need to be
    tampered slightly. TONY GREER: Yeah, yeah, that makes sense. What’s amazing is that they would have called
    Trump as a tremendous war hawk as he entered into office. And it seemed like he’s been at least, maybe
    not in the best of class, but he’s been sort of globally pretty careful. NICK SOFOCLEOUS: Yeah. Within the last week, we’ve seen the drone
    go down. And there was no air strike for whatever reason. TONY GREER: Right, following a Japanese tanker
    blowing up. Right yesterday. NICK SOFOCLEOUS: So, without knowing all the
    facts, all we know is these headlines. So, for someone to just turn around and say,
    all he wants to do is go to war. I’m like, well, that doesn’t look it to me. Because he hasn’t done that yet. Now, do I think that his international diplomacy
    is top class? No, I do not. But that’s just an opinion. What matters to me is markets. How do we react? How did we react to that drone? How did we react to the tanker? But I thought the oil markets reacted perfectly
    to an increase in stress in the Middle East. TONY GREER: Yeah, that’s about it. It took them a little while, but the price
    rallied 10% or so. And that the oil market respected at the gold
    market I think is respecting that among other things. There is certainly a good reason to be sort
    of looking into buying commodities on the dip. We like precious metals. Oil seems to be trading okay off the lows
    here. Most importantly, I wanted you to sort of
    define- you were really great. And I just want to wrap this equity portion
    up, you are outstanding in identifying the bull market from 2011 to 2015 as this is going
    to be a sort of Fed-assisted slow growth period that the S&P is going to be happy with. Then from ’15 to ’18, or soNICK SOFOCLEOUS:
    Well, ’15 to ’16. TONY GREER: To ’16. We were raising rates, the economy was growing,
    we had global growth. So, that was the premise of the market, higher
    rate, stronger economy. The S&P is okay with that. NICK SOFOCLEOUS: So15, you had your energy
    issue, where we started to go down, but the larger picture was you’re going to get an
    opportunity, because the cycle isn’t over. And that was when you could buy S&Ps at 1835. If I told you right now, you could have bought
    S&P at 1835, what would you say? Thank you. You’re 2950 and you say, okay. 1835, you’re good to go. TONY GREER: So, where are we in the cycle
    now? NICK SOFOCLEOUS: Oh, we’re really late, because
    we just changed. We just had the Fed- the Fed have just changed
    the cycle. Because now, we’re in a lower rate environment,
    we’re in a cutting rates environment. And the only time that the Fed have cut rates,
    and it’s worked out well, was late ’94 into ’95. Difficult to see this being 1995. TONY GREER: Right. Exactly. It’s just more like ’08, ’09 where they cut
    rates and the market wouldn’t take it. NICK SOFOCLEOUS: Right, because you had deteriorating
    economic numbers and the productivity gains just- with the internet, that was amazing. You just don’t have that now. You have business investment, business investment
    is not accelerating now. Back in ’94, ’95, business investment was
    as a percentage of GDP, was going through the roof. And you can see that, anyone can see that
    on their charts, you just need to know how to calculate it and you’ll be able to see
    it. And it’s a beautiful chart to show you the
    cycles. And if you overlay that with a curve, you
    really are 50% on the way to figuring out what does the cycle look like? TONY GREER: Well, I want to keep moving. Because we covered a lot of ground in the
    markets, we covered a lot of market history. And we let a couple of your tricks out of
    the bag, which was fun to do. But I want to sort of take a worldly view
    back, because our viewers have been enjoying me asking guys the question, if you are a
    young person in the markets today, and you see all these super traders and Masters of
    the Universe on television and you wanted to become one, what would your first step
    be into the financial markets? What do you think is available, whereas you
    and I could try to get a job at a big investment bank working on a desk of 30 guys, or men
    and women. Today, what are the opportunities for somebody
    that wants to become a trader? NICK SOFOCLEOUS: Yes. So, the environment has changed from when
    you and I decided that financial markets were where we wanted to be. Financial services have changed. There’s a couple of places that I would look
    at, first of all. One is deciding what my skill set was at this
    time. You’re 23, 24. What’s my skill set at 23, 24? You’ve probably got boundless energy. Do you like the markets? If your answer is yes, and you want to test
    yourself against them, terrific. And you need to find yourself a seat, there
    are companies that will allow you to do so- whether it’s using their capital, using your
    capital. Those aren’t the large banks anymore, because
    we know that doesn’t exist. But they do exist in a smaller environment,
    in a collegiate environment in different companies right now. TONY GREER: So, getting a job managing risk? NICK SOFOCLEOUS: Managing your own risk. And you can be taught by people, and there
    are plenty of well-versed, very successful people that would gladly have you on their
    team if you are successful. If you’re a successful trader in front of
    your own screens, people will like to have you on their team. Trying to find those companies is quite tricky
    because it’s a new set of ventures for people. As the banks lost to people, these new trading
    rooms did start up. That’s one avenue. I think that’s a very high risk avenue. I think that you need a counselor. You need somebody to teach you. And you need that constant because a lot of
    that is about confidence. The second thing is always- it’s something
    on the wealth management, you can help people within the wealth management business, and
    being involved in markets. And be hugely successful while helping other
    people. That’s a good gift. That’s a terrific gift to have. So, it really does depend, I think, on how
    you perceive yourself at a given age within your cycle. Your personal cycle. TONY GREER: Yeah, that’s a good point. If you are beaming with confidence, and you
    want to give it a try, and you’re single, you could probably get a job trying your own
    day trading operation somewhere. It’s not out of the question. NICK SOFOCLEOUS: It’s not out of the question. I wouldn’t advocate that. That’s a high risk strategy where you don’t
    even understand what your own risks are and how many risks you want to take and when. But there are plenty of operations when you’re
    looking to get into that type of market. Trying to be within financial markets, trying
    to get into a hedge fund. Terrific. Brilliant. There are hugely successful hedge funds. Super smart people. They are a joy to work with. They are a joy to work with. Not everybody’s on TV. Not everybody shouts from the rooftops. Sometimes, really, the best people, they’re
    around, you need to listen to them. Do your homework. Some of these guys will take the best of the
    brightest. TONY GREER: Yeah, that’s true. I like the wealth advisor idea too, because
    you can sort of swap your interpersonal skills and be wildly helpful to a wealth advisor
    operation and use that as your platform to learn about the markets rather than having
    them at your fingertips. NICK SOFOCLEOUS: Absolutely right. TONY GREER: Yeah, that’s a really good point. NICK SOFOCLEOUS: Absolutely. There’s a reason why family offices have grown. There’s a reason why the very large, historically
    large Wall Street firms want wealth management operations. There is growth in wealth management. And it’s okay to understand this. Well, there’s growth in wealth management. That’s okay. TONY GREER: So, even as the landscape changes
    quite a bit over the decades that there’s still entry level opportunities for people
    that want to be in this business? NICK SOFOCLEOUS: Absolutely right. TONY GREER: Yeah, that’s a fair point. That’s a fair point. All right. Well, I want to get way off of the business
    cycle and the business topic for a minute and ask you, Beatles or Stones? NICK SOFOCLEOUS: Beatles. TONY GREER: That was an easy one, huh? NICK SOFOCLEOUS: Yeah. TONY GREER: You didn’t think twice about it? NICK SOFOCLEOUS: Not twice. TONY GREER: What was your earliest turn on
    from the Beatles? When did they hook you? NICK SOFOCLEOUS: Oh, family. Family had their records. TONY GREER: Oh, yeah. It was all there before you. NICK SOFOCLEOUS: Oh, my goodness. Yeah. Absolutely. And also, they had melody. So, my record collection is nowhere near as
    vast as yours. It’s not really my thing. But as I got older, the Stones- you started
    listening to some of the Stones and going, oh, these guys were good. These guys were good. So, nobody’s bad here. It’s just a preference. TONY GREER: That’s for sure. Like the Beatles or Stones call you- the lesser
    of two greatness. You know what I mean. So, you can [inaudible]- NICK SOFOCLEOUS:
    Light blue, dark blue? Which one’s your preference? TONY GREER: You look great in both. That’s perfect, man. Well, we covered a lot of ground. I really appreciated you sharing a lot of
    your trade secrets, your history. All of this is so helpful, even for me to
    go over in an interview, and hopefully for the people that are watching to get your sea
    legs in the market and learn how to do that and learn how to survive. So, I can’t thank you enough for taking the
    time today, Nick. NICK SOFOCLEOUS: Absolute pleasure. TONY GREER: Great job, my man. NICK SOFOCLEOUS: Let’s see. TONY GREER: Brilliant.

    Trading the Market Open Like a Pro for Increased Profitability
    Articles, Blog

    Trading the Market Open Like a Pro for Increased Profitability

    November 5, 2019


    Welcome to T3 Live’s latest installment in
    ou webinar series. My name is Mike Milani. I’m the Director of Business Development here
    at T3 Companies and I want to take a moment to introduce tonight’s event and tell you
    a little about what will be discussed. Your hosts tonight will be Steve Levay and
    Mike Lee. Both are senior traders at T3 Trading Group LLC and are mentors for T3 Live’s new
    Trade the Open Mentoring Room. T3 Live and T3 Trading Group, LLC are separate but affiliated
    entities.  Both Mike and Steve felt for a long time that
    “Momentum Room” didn’t really capture what their trading style was all about and wanted
    to change their approach to reach a more specific audience.  After way too many brainstorming
    sessions, the T3 Live team thought that keeping it simple was the way to go and decided on
    “Trade the Open”.  It best captures, in simplest terms, the way that two of our leading mentors
    attack the market every day and offers a much focused approach for part time traders who
    only have a few hours a day to trade. Just some background on our hosts…..
    Steve Levay has been trading the equity markets since August of 2000.  In that time he has
    mastered the art of finding successful chart patterns and pinpointing the proper entries
    and exits for the trade.  His motto is “never turn a winner into a loser” and he trades
    remote from the Philadelphia.  Mike has also been trading for 13 years. Mike
    devotes himself to risk management and Mike is a master of the psychological aspects or
    trading. Both Mike and Steve trade with cash flow based
    strategies and collaborate in their mentoring room to help their traders optimize their
    returns and reinforce patience and discipline. Mike and Steve have made an art of finding
    the most successful chart patterns. Tonight, T3 Live brings you Lee, Levay and the Trade
    the Open approach. They will present some of these patterns and some advice for taking
    your profits when you have them. I will check in after the webinar. Should
    you have any questions about the Trade the Open mentor room feel free to reach out to
    our panelists during the presentation. Questions about the content Steve and Mike are covering
    should be saved for the Q & A session to be held during the last 10 minutes of the webinar. 1:47
    alright thanks Mike 1:53
    good afternoon everybody welcome to teach radio whether I am people they as
    1:57 mike said
    1:57 ubiquitous background about me case you don’t
    know who I am I don’t really like 2:01
    makes it since August up to 1000 I started with more sperling its growing
    2:05 enterprises and work my way over to
    2:08 53 companies today I do it for thirteen years
    2:11 I actually started as a white UK programmer
    way back 2:16
    and %ah marks early actually bought me to the group like I said
    2:20 %ah said the I you thought I have a knack
    for doing this and 2:23
    obviously the rest is history I’m still doing after 13 years
    2:26 om you know I can’t wait to get into the presentation
    I’m gonna give it to my 2:31
    great now to get a little about himself 2:33
    and then we will yet it to I thank Steve 2:36
    like much I my purse and I’ve been training sin
    2:39 April 2013 every market on
    2:43 in then I A have an incredible
    2:46 passion work making money and
    2:49 as this webinar you know continues
    2:53 I’m gonna show you how powerful you know betrayed
    the open 2:57
    can be I am I love what I do 3:00
    I love teaching I love helping traders 3:03
    get to where they want to be I’ve had group I’ve had om
    3:08 you know people learn for me and i lov trading
    3:12 and I want everyone to understand the passion
    we have that Stephen I have 3:16
    is incredible i’ve seen so many people 3:21
    walk in and out these doors in Steven I continue to
    3:25 make money and successfully build a business
    because of our rules 3:30
    and foundation and I am like Mike Moroney 3:34
    say I am about the mental aspect to the business when someone says
    3:38 you know trading at seventy percent mental
    in 30 percent technical 3:42
    and you know what I’m gonna concentrate on the mentality and the rules
    3:47 and about this business so let’s get into
    the webinar 3:50
    I’m excited to speak to you guys and I’m gonna turn over to Steve
    3:54 and into it IKEA so the obvious question he
    is what he is 4:00
    trade the OP and basically it’s as simple as that
    4:03 the first two hours my can I consider the
    open it’s the most volatile times a 4:07
    day 4:08
    it’s the most %uh humid titled our time a day where there’s no computers running
    4:13 the show and there’s a lot
    4:14 %uh institutional water flow going through
    4:18 the market that sa I used to be the momentum
    trading room by 4:22
    they didn’t really tell all like what my can I do basically
    4:26 movement me sorry left my stock is ron let’s
    sell a stock its 4:30
    it stopped by another one in that short another one really
    4:33 that is not captured the essence out we go
    about our business we’ve been doing 4:38
    this 4:39
    I moment a room for about two years and the thing that we realize
    4:43 as time went on and we look at our report
    cards and see 4:46
    where we ate already ate the most amount of our money
    4:49 and the funny thing was it always important
    whether it be 4:52
    a hot knife 3950 at a clock 4:56
    et cetera et cetera and bottom line was we found the first two hours
    5:00 where where eighty to ninety percent of our
    days were made 5:03
    and with that you know we decided I let’s rephrase in our room a little bit
    5:07 it radio pit and
    5:08 trade the open is great because you can’t
    beat somebody who works out on the 5:12
    west coast to get up at 6:30 listen mike night 5:15
    and then go to your real job at 9:30 I it’s very simple concept that really
    5:21 has a lot benefits so with that let’s take
    the next slide and now given over 5:26
    to Mike’s 5:28
    I thank Steve first of this 5:31
    is a real job and I want you guys to understand 5:34
    studying your profession okay every profession every business that you
    5:39 started my business
    5:41 I’m a traitor you know you could name a however
    you want to name it but this is 5:44
    my individual business 5:46
    and you have expensive and you also have that learning curve and what I’ve
    5:50 learned in studied about my
    5:52 trading okay is that like steve was saying
    5:56 I make most of my money okay
    6:00 in the morning nine thirty eastern to 11:30
    6:03 Eastern shoe hours okay is where are making
    my most profit 6:09
    I haha probably work about 10 to 15 hours a week
    6:14 and hit my goals if I work more potentially
    I might lose because I am 6:18
    NOT 6:19
    trading where I am most successful 6:23
    I am stock said I’d pic 6:26
    are critical we’ll talk about that a little bit into the webinar
    6:31 I make money long and sure i comin
    6:34 flat I’m not using the overnight mackerel
    risk I’m coming in with a clear 6:38
    head 6:39
    and confident every day okay 6:42
    it’s very important to understand it if you’re gonna make something a career you
    6:47 wanna be
    6:49 focusing on what is the most successful party
    your business 6:54
    and I really want you guys to understand that trading
    6:57 it not gambling it not that difficult if you’re
    sticking with your plan 7:03
    doing the right thing you know controlling your downside risk. we’re
    7:07 gonna talk about this
    7:09 an two hours a day okay
    7:12 you don’t get paid by the hour in this business
    someone was pay me 500 bucks an 7:16
    hour 7:17
    to hear from 9:30 to four o’clock but no one is paying me
    7:22 just sit here on IM pei myself
    7:25 to make good trades at the right time
    7:28 that gives me the best odd for my business
    7:38 okay go to the next one
    7:42 y’at but you can’t take that might get me
    out I’ll take this on 7:46
    yeah Lightray be open okay 7:49
    I I want you to understand that 7:52
    trading reopen okay it doesn’t mean at 9:30 a.m. one second it
    7:58 it set up from 9:30 to 11 9:30 to 11:30
    8:01 okay but what I’ve noticed is
    8:05 real volume real
    8:08 patterns have follow through and
    8:11 real traders are trading the open okay
    8:15 I find that 11-13 at two o’clock is probably
    one of the hardest time 8:19
    period work guys who are looking for follow-through 8:23
    Ormeau madame okay and the clothes can be potentially go but i wanna just focus
    8:28 on the ok
    8:29 okay we believe that this is the best
    8:33 time were followed through liquidity
    8:36 I missed so many patterns we look for
    8:40 you know two day highs five-minute our ranges
    8:44 on you know knowing that their or other traders
    8:48 I’ve been trading in an office for 13 years
    now 8:52
    there is no way there are more people sitting at their desks after two o’clock
    8:56 been at 9:30
    8:57 everyone is focused at 9:30 everyone is looking
    at their stocks 9:02
    I am plainly overnight game you know focusing on what’s going on in the
    9:06 market
    9:07 arm free market news to me the open is
    9:11 the you know time where people are concentrating
    on it the most 9:16
    and I’m going to trade where people are concentrating on
    9:20 okay patterns and news can be cleaner
    9:24 with greater degree of human treating it taking
    place I want you guys to remember 9:29
    that 9:30
    you always hear a program and you know tactical boxes or whatever the case is
    9:36 eighth to me but my experience they don’t
    go into effect until the buying 9:41
    slows down a little bit then they pick to take control
    9:44 look for a traitor the open it’s just perfect
    for me 9:50
    I let me just interject for second Mike the one other things guys and I i really
    9:54 truly believe
    9:55 is this part right here we believe the best
    place to find 9:59
    even what is that me there’s a human element to trading I see many times
    10:03 where the market
    10:04 is just get a absolutely smashed but there’s
    a program 10:08
    that’s holding up a stock but I feel should be going down
    10:11 that’s not sure maybe if you have felt that
    same way 10:14
    you know they’re the algorithm to hold the stock not because they have worse
    10:17 the filler or they’re trying to hold it up
    because they 10:20
    cert program running that has to take this baby
    10:23 or this offer and its so frustrating
    10:27 the human element of this job is probably
    the most critical 10:31
    which is why yesterday at two o’clock when when our
    10:34 this they decided they were good miss anything
    about a parade the market went 10:38
    up twenty 10:38
    and I me at was all you I 10:42
    basically traded emotion there Brooks is a computer program
    10:45 yeah I me sometimes there’s volatility late
    in the afternoon 10:48
    we find that most of the human element acted 10:52
    in the first to our trade so let’s take it to the next line here gang
    10:56 better quit treating conditions are one of
    the best reasons we trade the open as 11:00
    well when there’s more buying 11:02
    there’s more volatility obviously volatility the key ingredient for the
    11:05 active trader
    11:06 if you’re prepared escape our exit if you
    beat barry 11:10
    rewarded I had many people say to me why 11:13
    white sry the open the first two hours a day you can lose your whole kit and
    11:17 caboodle
    11:18 and basically I say to them they said if you
    are a traitor 11:22
    and you have you are armed with the right things you know you have to watch
    11:26 list
    11:27 yeah game plan you follow technical entries
    in 86 11:31
    then you are as prepared as you can be for the open yes you may lose some money
    11:35 at times
    11:36 but if you go if you have an arsenal every
    day you’re gonna probably make 11:39
    money more often than not 11:41
    because you’re air trader verses 1x just trading 11:45
    you know whatever because it move it higher volatility
    11:48 also equals higher rest but again when you’re
    prepared 11:52
    the risk is minimized because what we like to preach Mike and I
    11:56 is to minimize your risk and maximize your
    profits 11:59
    so are looking for trade in the morning maybe I’m risking 50 cents
    12:03 on a stop and I believe he moved to ours and
    you can bet that I 12:06
    definitely definitely obeying that 50 cent loss limit
    12:10 on my downside and Mike the same way that’s
    why we’re very disappointed 12:15
    traders are what we do 12:16
    and that’s what makes us very good what we do were disciplined enough to know
    12:20 that
    12:21 we have to obey our stock we’re just gonna
    blow up in the business 12:25
    and that’s something that we want our 12:28
    a lifestyle education the cat obviously trading the first two hours a day
    12:32 can allow you more freedom to rest your life
    for me 12:35
    I’ll Mike and I are on the radio Tuesday and Thursday from 10 to 30 doing
    12:39 education
    12:40 but on Monday Wednesday Friday when I made
    my goal for at 12:43
    and clock normally I’m going to go to the Chi able to go for a run I’ll go out
    12:48 for a bite to eat whatever the case may be
    12:50 you keep your day job you know you get you
    could 12:54
    make money trading and then go to another job afterwards because you you
    12:57 need to make a little more maybe you’re doing
    the business 13:00
    and you’re making a hundred dollars a day just starting and that’s not good
    13:03 pay your bills they have a second job that
    you 13:07
    om you need an x-ray come from and to be honest with the live healthy balanced
    13:12 life you’re running your
    13:13 you’re running like crazy in the morning but
    then from 12 o’clock you got not to 13:17
    do 13:17
    you’re taking a nap you’re like I said you’re going to the GM
    13:21 anything like that hand that’s the beauty
    of trading the open from 9:30 to 13:25
    11:30 13:26
    if you hit your goal bank your not it’s that simple
    13:29 your activities against you know
    13:32 the risk any money it’s that simple I hope
    everybody understands what we’re 13:37
    saying right now 13:39
    had my are preparing 13:43
    when you’re focused lives in the early part of the session
    13:46 okay even more important it be prepared
    13:49 right and the reality is guys
    13:53 I am setting myself up
    13:56 for tomorrow’s trade it soon at 9:30 hit
    14:01 the bell every morning okay I’m always thinking
    ahead 14:05
    how do I game plan how do we come up with their watch list
    14:09 how do we you know finalize our a trade
    14:13 and these are all things that
    14:17 I’m not telling you you need this
    14:21 and you you know has to have this an
    14:25 me come up with our walks us we always had
    different types of stocks 14:29
    so for right now let’s say we have a high beta list we have stocked at work
    14:32 on through it
    14:33 we have and I P O list we have 52-week high
    14:37 52-week low earning plays all of a sudden
    14:41 you know that could be a buncha stock so how
    we break it down it incredibly 14:45
    important 14:45
    and that’s one thing you will learn 14:48
    had a Wii game plan had a we do our watch list
    14:51 is probably this one of the most important
    and also beneficial 14:57
    think that we offer I disguises said you know around me in the office and they
    15:02 you know tell me all the time banks an I appreciate
    it and if that makes me feel 15:07
    good 15:08
    I’ll be get them to stand where are you human we do make mistakes
    15:12 and one thing that you have to understand
    it were real were real 15:15
    traitors all the time 15:17
    and if we do mess up your gonna know it and 15:21
    that’s incredibly valuable because when you learn
    15:25 this business you learn from people’s mistakes
    15:28 and I make mistakes Steve mark sperling Scott
    rather 15:32
    everyone makes mistakes in this business and 15:35
    you’re not alone and I want you guys understand that if you are struggling in
    15:39 your career
    15:41 you’re not as far off making money than you
    think I 15:45
    on Etsy can tell you that I believe that I can make every single person listening
    15:50 to me
    15:51 a better trader I could even make marks throwing
    a better trader 15:54
    I believe that in my heart 15:58
    he’s not say that he can make more money yeah he can make you a better trader
    16:02 because we can teach you
    16:04 it disciplines that we had in the preparation
    that we have 16:07
    all you know make you the trader you want to be
    16:10 I just wanna finish on one thing okay and
    it 16:13
    without a clear plan the tray be open 16:17
    or the opening trade however you want it you know the opening bell
    16:20 can be very costly when I always say
    16:24 all my god you’re so much rest is so much
    risk you’re in control the rest 16:28
    that’s the one thing that I love about trading that I keep control
    16:33 might downside risk yes they have to be disappointed
    hitting it out 16:37
    and I do you know miss my stops and how do I get outta
    16:40 trade this is all you know stuff that will
    teach you 16:43
    but I have risk I have control I could control the side
    16:48 my position I could control the stocks that
    I am trading 16:51
    I could control this spread that I wanna pay and I could control my stop
    16:56 and these are all things that you have to
    focus on focused on 16:59
    being you have control over don’t focus on 17:03
    thing that you don’t the stock market arm 17:06
    you know why this is happening don’t question it
    17:09 just react to the position and
    17:13 set up
    that you have 17:18
    go ahead steve okay guys know it what stocks to trade is very very important
    17:22 again that basically formulating your watchlist
    17:25 and as you read in the last lie I put out
    what’s in my 17:28
    when I watches every morning and to be honest with you
    17:32 most the stocks and I have on there are repeat
    stocks for me lately it’s been 17:36
    SOAD dess YS 17:39
    you I hate you just to name a couple and the real reason for that is there giving
    17:44 you
    17:44 work six dollar rages most theatrical
    17:48 lately every day and that’s something that
    I cannot 17:51
    move away from it the stock is gonna give me that I volatility
    17:55 which is the key ingredient then obviously
    17:58 I’m gonna stick to that I me i right now every
    day previous day’s range you know 18:02
    I’m 18:03
    right now X 154 48 I 5129 low I already have right now
    18:08 so tomorrow when I to me I know that I am
    booking a high 5448 gets through 18:12
    their 18:13
    I will look for a tree are we look at news place of stuff to get back at
    18:18 downer
    18:18 up big on her knees I what upgrades downgrades
    18:22 on reason I P o’s if you just saw this toxin
    we have 18:26
    My Watchlist right now for tomorrow already has
    18:29 on Sep it’s not so much okay and that doesn’t
    include like the yellow sticky 18:33
    use 18:34
    were a stuff like that that we might find two traits more more years ago
    18:38 shocks in a treaty
    18:39 two day and I want to be able to trade them
    tomorrow so 18:44
    familiarity for me is a very big ingredient 18:47
    in knowing what stocks that trade because I guess I I’d like to gravitate
    18:51 to stocks that
    18:52 have arm up good range a good Average True
    Range 18:57
    because long look at I have a lot of people might say see what do you think
    19:00 about the chk
    19:01 and the range in chk taste 56 on average per
    day 19:05
    I’m not really I said you know what the pattern looks great but it’s not really
    19:09 my property it’s not where I want to
    19:12 you know get involved with because to me when
    you’re trading a very slow who 19:15
    believe that comes more Ave 19:17
    sweet heart sweet light rate you’re not really worried about radio
    19:21 you’re putting out a stop 20 cents lower I
    let the stock do it stay 19:26
    so you know that’s very important to know what your watch list is going to
    19:29 consist of
    19:31 now creating the watch list okay based on
    that we create radio power wash was 19:35
    based on what in plain I just went over Watson 19:37
    way now a lot of time to stock up on our radar liked it
    19:42 late yesterday so I prob NXT I traded at today
    19:45 I got the offer yesterday I got the offer
    today tonight you know 19:49
    but it moves I need a little bit of money in any cuts rush in the afternoon
    19:53 know the UK short and I you know really wasn’t
    stopping I was watching I just 19:58
    noticed 19:58
    that it set up with the state’s base area around 48
    20:02 forty-nine so I will be looking at that stop
    tomorrow 20:06
    and then you know I remove we remove many stocks our watch list I used to
    20:10 treat
    20:11 the solar back to 2006 to 2007
    20:14 Mike and I were trading the solar sector
    20:18 completely nothing else I would trade so our
    lb Kyte 20:22
    just to name a few all day long I don’t care what the market was doing
    20:26 I care what other stocks were doing I was
    making money Mike to 20:31
    was making money trading the stocks that we were comfortable in
    20:34 and we were do it very well with that we were
    20:38 a basically making real consistent money because
    we stopped to 20:42
    our plan and as you see right there broke don’t fix it
    20:46 you know what’s the point in moving away from
    something if you’re making money 20:49
    doing 20:52
    hi thanks to you well he could talk 20:55
    I have to think I okay the one thing that I said why do you like to talk
    21:01 the one thing that I want you guys to have
    okay 21:04
    no matter what business you’re doing it straight in the opener train the clothes
    21:09 okay you have to have confidence and you have
    to be aggressive 21:13
    and when it comes down to trading and a couple guys in our chat room right now
    21:17 and we’re getting them to the next level they
    know what price they want to get 21:22
    they’re technically very sappy okay 21:25
    but what they’re missing is that confidence right now and that
    21:29 kick that aggressive I am
    21:32 trade to get themselves in this position
    21:36 I’m going to help you guys get into your positions
    21:39 it can’t hurt we talk about feelers to talk
    about stuff like that 21:43
    back to keep the trading competent and being smart and aggressive at the right
    21:48 time
    21:49 you should have value waste your performance
    both on a short and long 21:53
    term basis 21:54
    okay each day we look at stocks 21:57
    we’re seeing how we’re doing I look at my numbers to
    22:00 3-4 weeks out all the time I take my three
    best days by three worst days 22:06
    where my getting hurt how my doing you know 22:09
    where my making my money is it a sector 22:12
    on that maybe that sector started 10 1030 and always look at my time frame
    22:18 some stocks give you that opportunity have
    to study ’em it all patterns 22:23
    one thanks to you said it’s very important is what
    22:28 were comfortable with okay there is no
    22:32 difference between watching cash flow
    22:36 an apple St axe
    22:39 cliff whatever stock it is if you’re comfortable
    with it 22:43
    we’re all looking for work certain pattern in
    22:46 symbols we might like Xone
    22:49 you might not I’m not telling you to trade
    with 22:52
    be I’m just teaching you that discipline 22:56
    the rule that you need to trade your stock you’re comfortable with that
    23:00 really one thing I want you guys to understand
    okay 23:03
    each week Mon year I do the same 23:07
    thing okay 23:10
    we are producing videos for our room now 23:13
    there only for subscribers we r 23:17
    talking about what we did well what we didn’t do well
    23:20 what rate worked why they did why they did
    in 23:24
    going over our watch list and also 23:28
    giving you a psychological view maybe that setup was great
    23:32 I just mostly didn’t execute it right
    23:36 I am you know it incredibly important to keep
    learning I’m learning every day 23:41
    Oct real quick story yesterday I got hurt after the Fed I traded something I
    23:45 never tree before
    23:46 and you GT I entered it the
    23:50 volatility with extreme I got burned
    23:53 okay but I came in today and I said to myself
    23:57 it was the wrong thing to do I got hurt
    24:00 I didn’t trade Nuge cheap too nugg to make
    my money back 24:05
    I traded what was on my game plan I did the right thing today and I had
    24:10 good profitable day and that’s what I do best
    I’m not perfect 24:14
    okay either Steve we come in every day competent 24:19
    with the plan to trade be open and we 24:22
    absolutely have a passion love what we do 24:29
    thirteen years is trading me opened 24:32
    I’ve it’s probably six years a train the clothes you come out here by noon
    24:36 halftime but
    24:38 that’s what I like to do
    24:41 are you take to watch list example okay seriously
    stock so we’ve been trading 24:46
    3 D’s DVD assets YS 24:49
    and x1 okay are 24:52
    sort of like are many solar sector like he was mentioning a few years ago
    24:57 we are doing well in these are not in play
    every day but they’re giving us the 25:01
    opportunity to make money 25:03
    exit know any happen to be a very powerful lunchtime moved today
    25:08 I had a very good trade in it it makes me
    feel good I stuck with my game plan 25:13
    it stuck with my stock on my watch list 25:15
    something I’ve been stalking and it happen to be a very nice straight today
    25:20 the Chinese stocks cue I hate you
    25:24 by do sign a you know to name a few had been
    extremely bullish 25:29
    right Pandora Solar City 25:32
    hefley Yelp you know even a facebook id billow 25:36
    different stocks in my plan of protests laMere maybe an Apple
    25:40 all the sudden I have 12 15 stocks
    25:43 then I am looking at this is example what
    we do every morning 25:47
    and we’re gonna expanded to i’m looking to do different things with sectors
    25:52 in addition who the start something that is
    going to grow 25:57
    and we’re very excited about it so you can see on the right side
    26:00 will give you prices way to earning season
    26:04 earning season is one of my favorite times
    of the year IOM 26:08
    you know the watch this micro but it’s gonna be it
    26:11 you know it discipline ABC type thing that
    we are 26:15
    I am you know looking forward to 26:19
    and again guys to watch list is put onto out my PDF which every morning
    26:24 before we get on air so everybody knows what
    we’re talking about 26:28
    when we get on the radio it when you’re in our room it does it need you have to
    26:33 trade what we treat me just give you
    26:35 what we think are the best examples of the
    day 26:38
    on stocks that we think you’re going to have good rages and stuff that we can’t
    26:41 rate
    26:42 so with that let’s turn it over here two treaty
    coping strategies 26:47
    today jang Nara taking off now so can be applied almost
    26:50 a time frame we have found out that over a
    thirty years 26:53
    your career we have food a donut 26:57
    you and I don’t harass when are we went over a couple that
    27:00 but coupled with ample strategies we believe
    our best for archery 27:04
    the open strategy each other we thought deborah room
    27:08 and we focused heavily on them all the time
    and now 27:11
    basically what I’m gonna give you right now example and our favorite
    27:15 because you guys unless you’re gonna get our
    favorite strategy 27:18
    for free and here it is the five-minute high-low tree
    27:22 a very simple trade the setup is a 5-minute
    hi lo trate 27:26
    based on the opening bar on a five minutes are very simple
    27:30 if the stock breaks the five-minute hi you
    buy it if the stock breaks the 27:34
    five-minute were you sure 27:35
    the only thing required for this is a or misprint on the chart
    27:39 and you must have your writing here for a
    high 27:42
    or decline a period for a while and for mediator is either at the higher
    27:47 any through the five-minute hi work any through
    the lower at the low 27:52
    and for the stop and again depending on the volatility of stocks
    27:56 you know sometimes my house five-dollar open
    bar age 27:59
    but if you’re truly trader if I i lo tree you have to get it
    28:03 fifty percent of the open bar here’s an example
    28:07 in Tesla you’re hoping for it s the right
    here 28:10
    break at a five-year high along a flatter rising
    28:13 a purity amazing blog entry where would you
    get along right at this line here 28:18
    gay 28:19
    okay now you’re stop would be set basically 28:22
    right about here right middle the barn again looks like it’s about
    28:26 dollar why middle measure who is the with
    the opening bowler in this case two 28:31
    dollars 28:32
    we get from a high 137 guys I 28:35
    a if you might want to sell this report today 28:38
    dollar a dollar fifty maybe and but look what it did another
    28:43 HSDPA if you were truly looking to sway a
    trade like this 28:47
    okay also quite ready yet another one of our favorite setups that
    28:51 I’m not to go into too much detail now football
    why 28:54
    and they gave you another seven dollars to the
    28:57 upside on x ray so that’s the way you can
    trade a five-minute high trade 29:02
    and here’s another example SS why it’s break at a five-year high with a rising
    29:07 8 the stocky you a Stewart three-dollar
    29:11 opening act and look what they did with four
    straight dollars without even 29:14
    making a lower low in here 29:16
    so you couldn’t make yourself or dollar on a minimum entry
    29:20 had minimum risk right here about 96 risking
    your cell 29:24
    dollar you just wait four or five and again it doesn’t always happen so
    29:29 cleanly
    29:30 these are just examples that we have CE and
    I’ll be honest with the gang that 29:34
    that is one of the more successful trade that we make in our room it’s the
    29:38 five-minute hyper five-minute lo trate
    29:40 I let my go over the five minute lower right
    nearby again we’re very passionate 29:44
    about this straight it’s really 29:46
    a two-hour I I wish I did a study on how well 29:49
    successful what is one or more successful patterns
    29:53 and one thing that these charts art shelling
    29:59 yea blow mmm is that the first five minutes
    sorry about that the first five 30:05
    minutes 30:06
    the first opening range bar doesn’t have to break
    30:10 in the next five minutes this thing could
    happen at ten o’clock it could 30:13
    happen at 10:30 30:14
    a lot of times at the opening ranges you know 102 to 105
    30:19 and you get a nice tight wedge input Inbetweeners
    30:23 you know tomb I trigger points it gives you
    a setup 30:28
    potentially 10 10:30 or 11 so I just going on the stand it doesn’t
    30:32 have to happen the first five minutes as you
    can see 30:35
    x1 you have a catalyst you have a you know 30:38
    a stock pick clothes weaken the day be four that even give me more potential
    30:43 but you know what
    30:44 stock was weak if you’re opening bar
    30:47 we should work at the entry you can see that
    30:50 circle that line and we take it now look at
    this stock it didn’t crack right away 30:55
    but it never violated 30:58
    the previous bar and that it’s huge so 31:02
    once you break that five-minute low and that are split in
    31:06 I’m not gonna touch this thing and talk at
    the back above 31:09
    you know 66 in a corner it looks like it 31:13
    gave me a nice entry it set up a Bear Flag 31:16
    no stress and you know follow through 31:19
    here’s the thing I love the five-minute high and low trade
    31:23 because it gives me that momentum and ought
    to give me a stop 31:27
    the keeper trading is respecting the downside risk
    31:30 this is a low-risk high-reward potential trade
    for us 31:34
    you could expanded to you could do a 50-minute 31:37
    and you can look at ten o’clock the first 30 minutes
    31:40 and if this align with the five-minute Lohan
    I 31:43
    high and low trade active even more 31:46
    I am alignment and I love that we’re talking about that a little bit as well
    31:51 so let’s go to the next slide
    31:55 okay here’s another example at Amazon I
    31:58 it doesn’t matter what it is I we’re just
    you know giving you 32:02
    clean setups that we have looked at here’s Amazon you have here’s a good
    32:06 example
    32:07 here’s 15 minutes into the day 5
    32:10 can break okay never violate
    32:14 the the previous or get me a night
    32:17 setup now where do you cover everyone said
    I always 32:21
    day in trading the easiest thing to do 32:25
    is einer stock this second thing it 32:28
    to you know obey your stop and the third thing is where
    32:31 is my target and steve mentioned you could
    use targeted 32:35
    opening range on you could use yesterday’s range
    32:39 yes stocks that I you know yesterday support
    32:43 daily support these are all points I’ll
    32:46 you know interest but what Stephen I do incredibly
    well what we’re teaching guys 32:51
    in the trade the open class 32:54
    if takeoff Hampshire position for a profit and if you
    32:57 if you buy a thousand shares at $15 yourself
    500 33:01
    50/50 all of a sudden you’re locked in 33:04
    if this stock dropped a dollar on you you’re breaking even
    33:08 so always sell half your position I will tell
    that 33:12
    everyone I am NOT looking for a home run were single
    33:16 doubles throw in a trip on potentially home
    run 33:19
    but you know what it is 33:22
    incredibly important to sell half and just think about that
    33:26 now you’re playing with the house had money
    and you’re relaxed and you 33:30
    book some profits and you could use your previous entry at the stop
    33:34 and you still booked use of two hundred fifty
    dollars on that trade 33:38
    never turn a winner into a loser is one of our
    33:41 biggest bangs we’re here to make money
    33:45 I making money is what makes me the happiest
    going to the bank every month 33:49
    I’m a traitor I don’t like to send email doubt 33:53
    and make phone calls I like to make good trade with lower risk
    33:57 and keep book in those damn profits
    34:02 hi guys I just wanna go back to the apt x1
    slide right here for a second explain 34:06
    year 34:06
    what Mike said as he noticed and again this is a two hr
    34:10 basically this is the way x1 close
    34:13 the day before it broke down right here and
    you can I want to you 34:17
    well straight rate bars okay 34:20
    gives you an idea for tomorrow okay 34:23
    the stock closed extremely weak that has to be on my radar for breaks the
    34:27 previous day’s low
    34:29 okay and what we got off the belt here was
    that weeks 34:32
    five minute break now but what makes it Bear Flag
    34:36 it again when you’re in our route you know
    what a fair fight Oakley 34:39
    most if you do know what a bear ideas but if you go to ace this weapon or even
    34:43 better because you’re going to want to sign
    up with us 34:45
    and learn what a Bear Flag is but again this stock never
    34:49 violated up here where the Anna
    34:52 50 percent at the bar is look where
    34:55 okay it if you look at it our tickets were
    34:59 a movie even though it stopped raining here
    for a little bit of a plus 35:03
    that to be is why 35:06
    I you know I really do believe that this tree 35:10
    unified High Low is what are the most important especially to worry
    35:13 urgency arm you know when you have it
    35:16 handle it it’s very hard to do five and I’ll
    I want to stop by Others UCLA 35:21
    you know if CL ad is not really moving effect me see if I pull up a chart see
    35:26 our
    35:26 right here every one sec your of the following
    up a chart guys don’t want to 35:31
    tell you something that 35:32
    we haven’t talked about guide me 35:35
    it I is getting distracted and 35:39
    when you have a plan and when you have a watch list and you have stocks you’re
    35:43 comfortable with in your back pocket or whatever
    you want to say your basket 35:47
    it it easier not to get distracted what what hurts traders
    35:51 not having a plan and I see it all the time
    on the trading floor 35:55
    I am you know they’re like looking at the open it somehow caught Apple make
    35:59 pull up apple on them a question on my God
    where they buy it 36:02
    what’s my plan the first 30 minutes 36:06
    at me if you’re going to trade the open competent and being crafted
    36:10 its sticking with three to five stocks
    36:14 you know you don’t wanna miss that trade so
    a lot of time 36:17
    in the first 15-20 minutes I only have two or three stocks and I’m really
    36:21 looking at
    36:22 and it you know I have to really come in within
    a plan in 36:25
    and not get distracted when she get distracted it all the sudden you start
    36:30 questioning yourself
    36:32 I’m gonna give you guys a little bonus play
    for tomorrow here’s a five-minute 36:36
    lo trate 36:37
    that works somewhat this morning in x1 okay here’s your five-minute lower right
    36:41 here
    36:42 the price is our 5181 the only work for about
    60 cents right here 36:47
    but what it is air flight and stay out the Bear Flag
    36:50 okay and what happen the stock took off from
    the bottom 36:54
    and never look back for tomorrow this stock 36:58
    did the optical what the slideshow to you it was
    37:01 very strong so we had a little bit of a pool
    slide closing the day 37:06
    in XY so like I said for tomorrow this stock is on my radar for strength
    37:11 because how strong the stock closed and yes
    if there’s news on a baby gets 37:15
    downgrade or something 37:17
    I won’t be a poster shortly I’m just putting out on the radar
    37:20 that a move above it 54-48 level
    37:24 will allow us to pry get that measured move
    up to 55 56 37:28
    and that we should take some money off the table and sit back and now
    37:32 wait for another set HR 2 I’ll call up my
    37:36 before we go to the Q&A I notice with that
    axe want rated show 37:41
    a lot of times when I do continue to trade Allison
    37:45 I trade the open religiously okay but I will
    sit at my desk and way 37:50
    an if you are going to trade throughout the day you have to be extremely patient
    37:55 and I just saw 161 broke that rule it it’ll
    downward trend right here today 38:00
    right there 38:01
    had a quick bar I’m not gonna catch that no one’s gonna catch it
    38:05 but that gives me something to look at this
    is another pattern 38:09
    and we talk about this reversal patterns I’m all flags
    38:13 and these are big big pivot point them in
    this thing put in that 38:17
    range i’m looking at this thing and I’m like ready that strike about fifty two
    38:21 and a quarter
    38:22 and I did and happened to be a very nice
    38:25 reversal trade if you look at that trendline
    38:28 on the two-day on the bottom that trend it
    never really broke 38:33
    so the alignment for short wasn’t as powerful as I like
    38:38 and we always talk about alignment on the
    daily and intraday and two day 38:43
    guys there is so much information we can talk about right now
    38:47 we don’t have enough time but we just want
    to give you 1 38:50
    you know cheeser a five-minute trade om 38:54
    M you know what kept some questions but you know open it up to
    38:58 Q&A
    39:02 I and John is our moderator he will be posting
    the questions for SK 39:07
    I S people take the first one at all I’ll 39:10
    I’ll we just feel that your 39:14
    okay radius r you all in all out a traitor descaling out a great question
    39:19 ready
    39:20 arm as might say if we’re playing x1 for instance
    39:24 I and by say through the five I say to you
    want your one-and-a-half 39:29
    depending on how the stock looks to make and their Sally
    39:32 as I can on the way up so maybe if I say two
    thousand shares x1 39:37
    I was going on a number I don’t know I really do but i buy 2000 shares
    39:41 on South thousand say fifty cents higher account
    to put it out there 39:45
    see if i cant I’ve already booked five hundred dollars in the trade
    39:49 now i cant have my stop at breakeven and I
    could feel some of its like yesterday 39:53
    I saw another 39:54
    200 70s and Sr 300 80 cents higher 39:58
    and while he was away at my piano trio with the rest the tree
    40:01 and the rest of the size I have when I already
    40:04 book money in that race even if it fell back
    now 40:08
    i’ve still made my on a good portion of the trade and that
    40:12 is unbelievably important to our business
    we really have to make sure 40:17
    that were taking profits on the way up or down if your shorty
    40:21 on you know we’re not all in all out right
    away we 40:24
    liked it by RT your average whatever to your baby and sell pieces other assets
    40:29 going in our direction
    40:36 okay sandy to trade option
    40:41 or just stocks okay so we will
    40:44 i’d generally right now I’m just trading stocks
    I 40:48
    no options we kid talk about option 40:51
    it’s just shameful of to see if the really about the technical pattern
    40:56 I know options in the first five minutes might
    be a little too then 40:59
    but you know we are stock traders I 41:02
    we do trade options at a time as it now 41:05
    I’m having a lot of success just trading you know equities without the option
    41:10 and I don’t need a get some time distracted
    41:13 I am almost traitor that laws coming in flat
    41:17 you could take um you are I’m not taking home
    much size 41:21
    on banded I’ll really how we trade in trading the open
    41:25 you don’t need that much equity
    41:29 you’re not influenced by the overnight tape
    and you’re really coming in with a 41:33
    clear head every time 41:34
    n I think with those three things that’s what makes me tech
    41:38 I am I don’t like stress I don’t like dealing
    with things that I have control 41:43
    over 41:44
    and you know that what makes me tick and that’s what I gotta stay with so rather
    41:48 now on we are stock traders
    41:51 I’m but there are options trader in our chat
    41:54 and I will give you you know if I saw on that
    as well 42:03
    okay Vivian what happens if the stock goes down after the first time the
    42:07 apartment then goes up later in the morning
    42:09 ok at another good question arm for me
    42:12 the stock if I buy a stock and it violates
    my rule 42:16
    let’s say I 1×18 fail right away 42:19
    of how to stop but that doesn’t mean I’m not watching it
    42:22 are looking to see how it rates to the lows
    does it make it new five-minute 42:26
    whoa 42:26
    and it bases like x1 it today it takes all 42:30
    I’m still using that high today’s my gauge to get long
    42:33 om you know again its it’s very
    42:37 it’s a bar that it doesn’t meet the exact
    science 42:40
    okay so if I bought it and fifty I feel little more confident that I was gonna
    42:45 be right
    42:46 if it needed to five feet high let’s say versus
    by 42:49
    wanted 935 in 30 seconds because 42:53
    if it fail right away I would it feel I stop it was gonna go awry up but its 850
    42:58 it’s already had the app
    42:59 first half hour gyrations maybe 10-15
    43:02 58 high is still set when it takes off through
    their 43:06
    I’m feeling a lot alive of its there 43:11
    but there are are there aren’t any bad 43:15
    questions okay marcaste 43:18
    iraq daily recap: two days ago you 43:21
    great about seven stocks on daily basis how do you have much time
    43:24 us okay so I’m not entering mark
    43:28 all seven stocks I’m breaking it down into
    my 43:33
    ATP potential CE left 43:36
    like I said of the openness just in the first 15 minutes
    43:40 30 min to the day I’m focusing on a basket
    of stocks but I’m really 43:45
    concentrate on the ones that I believe potentially is me that
    43:48 best best scenario maybe
    43:51 at daily setup close to yesterday’s high
    43:55 on earning play you know stuff like that maybe
    a little 43:59
    upgrade in the morning any little catalyst in the catalyst is key
    44:04 to trade in the open and really trading throughout
    the day 44:08
    why do stocks go up or down people get frustrated a lot on the trading floor
    44:13 throughout the day in so many stocks with
    44:17 I listen okay I learned this business really
    through people who 44:21
    didn’t do well I did the opposite very early in my career
    44:24 and it worked and that I built my kitten and
    I listen to people struggle 44:29
    and I right down the stocks in like well thats docket no catalyst look at the
    44:34 daily chart
    44:35 look at the intraday pattern that’s where
    you get hurt we’re pattern traders 44:40
    and I take the few best stocks every morning and you know strike in
    44:45 if they don’t work I him out I accept my Lawson
    44:49 find that next batter
    44:52 okay just the barriers to use metal stocks
    are our stuff and how much do you 44:56
    watch the level 2 44:58
    I it’s a good question I never ever 45:02
    use heart stopped unless walking away from my desk
    45:05 I’m a conspiracy theorist and I do believe
    that market makers do have 45:09
    potential run the stocks 45:10
    they could see are are stop I do believe that at me if i were quite how to stop
    45:15 it I’m sitting there
    45:16 this topic go down I stop in the other direction
    I expected it 45:20
    so I’d much rather happen metal stop when I
    45:23 sitting in front of my desk because I want
    to take a chance that somebody can 45:26
    see my water 45:27
    want to liquidate be there office park watching a level two weekend
    45:32 I’ve gotten away from I used to call myself
    a level two special is where I 45:35
    can really I 45:37
    you know manipulate my my positions because we’re watching a level two but
    45:42 lately because it the algorithms and
    45:44 all that something you know size of I better
    offer doesn’t matter anymore 45:48
    and I’ve tried it get myself away from watching a level 2 I’d say watch a
    45:53 little too well
    45:54 30 percent om when I made the trade I try
    to keep more of an eye on the stock 46:00
    I’ve been on the charger way I in the trade trying really
    46:04 manage my position arm you know again
    46:08 the algorithm thought the hit 10,000 share
    it’s like they’re nothing anymore 46:12
    and it’s gotten away from me where I like I said I used to be a special is a
    46:16 little too and now I feel like a rookie trader
    46:19 when I try to follow just what the level two
    is doing 46:24
    always have heart stops ok you get up from UC
    46:28 have to go for launch you don’t wanna come
    back in that rocks 46:31
    you know two dollars lower always have that you know stop in play when I’m from
    46:36 I see I always have to stop put out there
    because that way it’s on happens 46:39
    in the market and I’m not there 46:41
    I can get out without any too much damage 46:45
    okay iron let’s go on to the next question here
    46:50 premarket gaps I am
    46:53 incredibly important lesson gap bills are
    46:56 I’ll one of my favorite things to do first
    rate gap saddam 47:01
    you know it if I I don’t know 47:04
    microsoft has good news in the S&P Zara be handled in UC
    47:09 x1 up a dollar fifty because the f2p 0 on
    Microsoft is 47:14
    you know x1 might be a nice short if it near resistance
    47:17 so premarket highs and lows I don’t really
    take too much effect in but the 47:21
    previous day high and low 47:24
    on that range is huge I do ever trade premarket I do
    47:29 you have to understand though premarket
    47:33 if I make a little bit it’s like i whatever
    if I was a little bit I get 47:37
    very angry myself but what am i doing 47:39
    so they for me and let the really cool Id 47:43
    good by in type trade I may be a big economic number like a job report
    47:49 and earning play a pre-market an after hours
    47:53 you know we do trade I earnings that’s one
    thing but just to jump in 47:59
    you know I was talking about dealers all put a feeler on
    48:03 yeah I think so or city for example today
    with strong maybe i buy 48:07
    I feel or you know premarket just to keep me in it
    48:11 but the really put on a trade I think that
    the little 48:15
    you know real aggressive for the way I like the approach my business
    48:20 k’nex question is how many hours a day do
    you do homework 48:24
    and research the next day’s play I’ll be honest with you right now I already have
    48:28 like I told you earlier
    48:29 about seven at my place for tomorrow already
    written down so I would say 48:34
    you know I do about half an hour and night eight maybe at night
    48:38 doing such art work in an hour checking I
    watched this is but a lot of my work 48:42
    is done 48:43
    intraday and then free-market war morning so I didn’t want my computer
    48:47 every morning at 7:30
    48:49 and by 8:30 I’m usually 100 percent ready
    to trade what I want a tree 48:55
    om you know for me it’s very important to be prepared like I said
    49:00 and I always I always write down every day
    49:04 the highs and lows in the stocks are traded
    to the previous day I got my said 49:08
    it’s tough right now 49:09
    everyone to as the high and low it now so tomorrow
    49:12 if they’re weak I know that my first actually
    might be through the low 49:16
    previous day or 49:17
    I you know its strong maybe the higher the previous day
    49:20 it’s very Tom important you guys know what
    you’re looking at I like to go to 49:25
    bed at night 49:26
    knowing when I wake up in the morning I’m not just looking like a deer in the
    49:29 headlights
    49:30 and I’m just hoping I find this topic to be
    in play 49:34
    so hopefully that answer that question pretty easily
    49:37 yeah I next question Diane like I’m gonna
    start 49:41
    healthy voice started that great question I’m gonna be honest with you
    49:45 well this is a really bad question on FB just
    thought you 49:50
    a state the obvious so what time do you start the chat in the morning to prepare
    49:55 did you just answer that I did not go ahead
    okay we 49:58
    our on-air Stephen I 8 45 every morning 50:02
    I we’re on air from 8 45 to 11:30 everyday 50:06
    I we r game-planning even I’ll talk about stocks were looking at and then
    50:10 you guys are open
    50:12 forum to about 9:25 I like to
    50:15 you know the last five minutes before the
    open is the time to really just 50:19
    settle in if you don’t know what your trading 50:21
    fill up your water if you don’t know what your trading by 927 you probably
    50:25 are prepared
    50:27 so I always say that left five minutes you
    know get yourself calm 50:31
    I’m Mr on air Tuesdays and Thursdays doing education from one to 230
    50:36 on to the next one as well nom Christopher
    at you 50:40
    close positions on a time basic dampening 11:30 and you have some your
    50:44 position lap
    50:44 you close it out okay
    50:48 what we do okay if the if the position hasn’t
    broken down or 50:53
    failed will put trailing stops out 50:56
    if I’m not at my desk in at 11:30 in the position still looks great
    51:01 I will keep that core position
    51:04 you know trading reopen aggressively managing
    positions in the afternoon 51:09
    is exactly my business I love 51:13
    morning trade effin X 100 shoot a three dollar range in the morning and
    51:18 of lagging at 11:30 to 1 o’clock you better
    believe 51:22
    I’m gonna put on a position I have a strict 51:25
    stop I also have rules in place and one thing that I want to really talk about
    51:29 real quick to take a second
    51:31 isn’t understanding money management
    51:35 and if you’re having a really good morning
    and you wanna trade 51:38
    tear up a grand the thousand dollars before 11:30 you get launch you love a
    51:43 pattern
    51:45 have that discipline and then
    51:48 give back no more than 25 30 percent your
    day 51:52
    don’t stress out you had a great morning 51:55
    you know if you wanna try something give back to three hundred dollars but
    51:58 book seven hundred box an come back the next
    day and 52:02
    do it all over again and you will be a happy traitor
    52:09 mom JCS will the Eagles defense show up and
    play tonight well 52:13
    Jason that’s a great question and now I hope so
    52:17 my guess is no and unfortunately I I think
    it could be another slugfest 52:22
    I hope the bird all without but Mike my guess right now I have to say is I P
    52:26 shorty Eagles defense
    52:29 what do we see rey de s what we see your mentoring
    room you’re sweet years Creek 52:34
    three questions the two and I’m going to be honest with you
    52:37 I it’s a very good question
    52:40 I we see you’re gonna see I my chart
    52:44 might start and not the one thing you can’t
    do is have both our videos over 52:48
    the same time 52:49
    so you’re going to see my charts what i’m talking about.
    52:53 you get here just let you hear me now you
    can hear me live trading 52:56
    talking about what I’m looking at weeding out both black bear flight five
    53:00 minutes I’ll owes
    53:01 and you get the state thing with my om
    53:04 like Mike set earlier we are human beings
    we do make mistakes that 53:08
    sometimes we are emotional 53:10
    and you know it’s understood it’s one of those things where
    53:15 it’s very hard to trade talk on the radio
    and try to educate 53:20
    and and when you’re losing money it just makes it that much harder
    53:24 I try I’m a little better than my turning
    my microphone off and throwing 53:28
    things around the room they getting back into my seat
    53:30 mom but might might definitely I
    53:34 wears his piano on his sleeve and you can
    sometimes hear that’s not a bit 53:38
    he’s the more emotional up the two of us but that we will see and hear
    53:42 when you’re in our chapter but one thing I
    wanna say 53:47
    real quick and I’ll get to tom’s question is
    53:51 the traders who were in our room learn more
    from 53:55
    when we you messed up and when we do get emotional because he realized like wow
    53:59 I’m not alone
    54:01 I’m learning from this guy and they really
    respect and appreciate that so to 54:05
    me 54:06
    I think it’s off or I would even be probably more crazy if I was allowed to
    54:11 if not a bad thing a model library in a much
    greater this trading real money 54:15
    all the time I don’t get paid you know salary or
    54:19 an hourly wage so it’s like you know what
    this is real money on everyone 54:23
    listen to me 54:24
    it in the same boat and you know respect that dollar
    54:29 keep your motion height but you know
    54:32 it’s okay if you lose it wanted a lot just
    54:35 understand that you know part of the business
    and we’re 54:38
    let me just interject work with Mike 1 one of the things guys that I am a true
    54:43 believer in
    54:45 is work we’re not robots we don’t make money
    every day and if you’re signing up 54:49
    with us taking that we do 54:51
    you’re going to be upset you know if we have that losing they have to understand
    54:56 that we do lose money and you’re not learning
    anything 54:59
    if we’re not emotional and we’re not losing money because
    55:03 we can’t teach you if we had at work one of
    the most important thing is I think 55:07
    I had a bad day I really big day last month 55:11
    and and it woke my will be %ah p absolutely 55:16
    killed me that day but then I started realizing that I was an idiot
    55:19 and I was completely on this when and from
    that day on I haven’t had a mere 55:25
    I’ll and it really was a oblique spirit but it’s what me
    55:28 and it always teaches me to just be smart
    with my 55:32
    you know is issues my PE now and to really 55:35
    when I have that big a step back and really waking up on the gas a little bit
    55:41 I let me answer tom’s question of fast on
    Tom 55:44
    ass what criteria do you use in a scan to put your watchlist
    55:49 now I have used scan I am
    55:53 one thinks can do some time is distract me
    so my scan is really my work 56:00
    my chart work my highs and lows by trigger point might daily charts
    56:04 I put everything together to by my stocks
    or not depending on 56:10
    stand to give me my trades I am watching probably about 15 to 25 stocks everyday
    56:17 I rotate them I put a couple new one then
    56:20 that’s really Mike scan at Tom
    56:24 but there are things that I am going to work
    on and we are building 56:28
    I scanned that we do follow maybe the five-minute high trade
    56:32 and you know put criteria of all the stocks
    56:36 you know we are looking at real quick I know
    we have to go I’m gonna close on 10 56:40
    guys 56:41
    I love trading I love everything about it 56:45
    I teach with a passion I want everyone 56:48
    as well yeah I’m I love to help 56:51
    traders because you guys are wanting to do this is the first step
    56:56 in to entering the business were even becoming
    a better trader you’re here 57:00
    hopefully you enjoyed it one thing I want you guys understand
    57:04 it this is a of business but you can make
    it 57:07
    into a very successful on stever not 57:10
    even higher not Harvard grad he doesn’t even know how to spell Harvard
    57:15 week I’m in everyday with
    57:18 the attitude and a competent to
    57:21 you know really make a living at it and you
    know we have 13 years 57:26
    the show where it all leads Steve closed and a it was great talking everyone
    57:30 guys like Mike just said we are absolutely
    passionate about what we do 57:34
    and i really am appreciate the time you gave us
    57:37 I’m gonna turn it over to Mike Maloney now
    go Eagles and everybody have a great 57:41
    day 57:44
    Steve, Mike; thank you for that. Everyone, just one quick minute before you
    go, first, thank you for attending. Second, if you enjoyed the content of this webinar,
    we want to extend to you, as a registrant, an exclusive discount on our new Trade the
    Open Mentoring Room. We are offering a six month package for $1000.  The normal retail
    price is $1800. This offer will be available for one week only so email us at [email protected]
    to sign up or call 1-888-998-3548 Visit T3Live.com for more information regarding
    courses and subscriptions to improve your trading.
    Again, thanks for attending T3 Live’s Trade the Open Webinar. Keep in touch.

    Norbert’s Gambit at TD Direct Investing | DIY Investing with Justin Bender
    Articles, Blog

    Norbert’s Gambit at TD Direct Investing | DIY Investing with Justin Bender

    November 4, 2019


    Hello, I’m Justin Bender, Portfolio Manager
    at PWL Capital in Toronto, and today I’ll be showing you how to cheaply convert your
    Canadian dollars to US dollars at TD Direct Investing, using a strategy called Norbert’s
    gambit. For this tutorial, I’ll be exchanging about
    6,000 Canadian dollars for US dollars in my RRSP account. Before getting started, please ensure that
    you have a US dollar RRSP account already set-up. If you only see a Canadian dollar account,
    call TD Direct Investing at 1-800-465-5463 and ask them to open one for you. When you’re ready to get started, click
    on the ‘Buy/Sell’ icon at the top of the screen For our first step, we’ll enter ‘DLR’
    in the ‘Symbol’ field. DLR is the Horizons US Dollar Currency ETF. The fund invests in US dollar cash equivalents,
    but can be purchased with Canadian dollars. When the fund name appears, click on it to
    generate a quote to the right. We can then select ‘Buy’ as our ‘Action’. To calculate the number of shares that we
    need to purchase, we’ll use our computer’s calculator: Taking our Canadian dollar cash of $6,000
    and subtracting the $9.99 trading commission gives us about $5,990. We’ll then divide this value by DLR’s
    current ask price of $13.27, which equals 451 shares – we can then go ahead and enter
    451 in the ‘Quantity’ field. We’ll select ‘Limit’ as our ‘Price’,
    and enter the quoted ask price, which is $13.27. After you’ve selected the ‘Remember password
    for this session’ check-box and entered your trading password, you can click on ‘Preview
    Order’. When you’re ready to confirm the order,
    click on ‘Send Order’. And to check the status of the trade, click
    on ‘Go to Order Status’ – here you’ll note that the trade has been filled. Before moving to our second step, we’ll
    need to wait until our initial trade settles, which is three business days after we placed
    the trade. As we placed the initial trade on January
    20th, 2017, we will need to wait until the trade settles on January 25th, 2017. Please note that the investment industry is
    scheduled to implement a T+2 settlement cycle, beginning September 5th, 2017 (so you will
    soon be able to complete the gambit in one less business day). For our second step, we’ll call TD Direct
    Investing at 1-800-465-5463 and ask them to transfer 451 shares of DLR from the Canadian
    dollar RRSP account to the US dollar RRSP account. When the transfer has been completed, your
    451 shares of DLR will now be showing in the US dollar RRSP account (this generally occurs
    by the end of the day or the next business day). For our final step, we will be selling 451
    shares of DLR.U. DLR.U is the exact same security as DLR. The only difference is that DLR.U is transacted
    in US dollars, while DLR is transacted in Canadian dollars. Click on the ‘Buy/Sell’ icon at the top
    of the screen, and then enter ‘DLR.U’ in the ‘Symbol’ field. When the fund name appears, click on it to
    generate a quote to the right. We can then select ‘Sell’ as our ‘Action’. We can also enter 451 in the ‘Quantity’
    field, as we will be selling the same amount of shares that we originally purchased. We’ll select ‘Limit’ as our ‘Price’,
    and then enter the quoted bid price, which is $9.94. After you’ve selected the ‘Remember password
    for this session’ check-box and entered your trading password, you can click on ‘Preview
    Order’. When you’re ready to confirm the order,
    click on ‘Send Order’. And to check the status of the trade, click
    on ‘Go to Order Status’ – you’ll note that the trade has now been filled. When you refresh the screen, you’ll find
    that your 6,000 Canadian dollars have now been converted into about 4,500 US dollars. You are now free to purchase US-listed ETFs
    with cash available in your US dollar RRSP account. If you have any questions, please feel free
    to send them to me by email: [email protected]

    Can You Get Rich by Following the “Smart Money”? / Follow institutional order flow Dark pool trading
    Articles, Blog

    Can You Get Rich by Following the “Smart Money”? / Follow institutional order flow Dark pool trading

    October 8, 2019


    Can You Get Rich by Following the “Smart Money”? // Follow institutional order flow, dark pool trading, block trades, on balance volume, on balance volume indicator, dark pool explained, stock market investing strategies welcome to looking at the markets with David Moadel today we’re going to try to answer the
    question can you get rich by following the smart
    money block trades institutional order flow these are some of the terms that vaguely
    lead us to the notion of smart money these evidently are powerful investors
    that make profitable trades before the dumb money or retail traders try to jump
    on the bandwagon but inevitably end up missing the boat often it is asked whether retail traders
    can trade alongside the smart money mirroring their trades and effectively
    piggybacking or riding their coattails – big profits who is the smart money
    anyway the term smart money generally refers to
    some or all of the following high-frequency traders hedge funds
    market makers large institutions algorithm-based investors and any person
    or institution that makes very large volume trades at any given time the
    vagueness of the term smart money makes it difficult for retail traders to
    follow them because it’s not exactly clear who they are besides the trades of large investors
    can be highly misleading and blindly following their moves might not benefit
    retail traders for all we know a seemingly bullish moved by the smart
    money might actually be short covering or a
    hedge against a bigger bearish position for example buying shares or calls of SP
    why as a hedge against a larger position in a vicks product or classic market
    manipulation using their big influence to drive up the price of a stock before
    retail gets in and then selling while retail is left holding the bag while a
    seemingly bearish moved by the smart money might actually be profit-taking or
    scaling out of a bigger foolish position or a deliberate attempt to take out retail stop losses before turning around
    and pushing the price higher besides some of the really big trades
    aren’t available for retail traders to view until hours later or even a day
    later by then it’s probably too late to do anything useful with the knowledge of
    those trades while retail trades are transparent the
    smart money has the privilege of making temporarily secret or hidden trades this is known as dark pole trading and
    while it might be controversial it’s currently legal in the United
    States Chartists might try to use obv or on balance volume as a proxy for smart
    money movement in order to predict where price action will go personally I find that on balance volume
    tends to move in tandem with price action rather than before it thus
    diminishing its predictive ability to conclude I would recommend against
    trying to follow the smart money as a get rich strategy instead focus on
    building a safe consistent plan for long-term growth in your trading account
    if you’d like more help with this or with anything having to do with finance
    stocks or options please feel free to contact me my name
    is David Modell you can reach me anytime at David Modell
    @ gmail.com I hope this was helpful and I hope to
    hear from you very soon

    Articles

    Understanding the Battle Between Shorts and Longs

    October 2, 2019


    – It really pays to
    know about short selling and how to avoid it. Kind of understand the battle
    between longs and shorts. (upbeat music) Okay, so let me talk about GHSI. Here’s the chart. Over 100 days, it is absolutely terrible. Over 10 days, you know,
    yesterday it had some spiking. It had some pre-market
    spiking, then it came down, then you had another big spike, came down, and another big spike and
    then it’s kinda petered out. Now today, it’s just dead. This lack of bounce today suggests that it’s gonna probably crack the 160’s. Shorts are probably loading up, going to go to the 150’s, 140’s. The fact that shorts are loading up, still means that it could
    potentially squeeze today but this kind of play, where it frankly just keeps bailing year after year, day after day, month after month, it pays short sellers to bet against this. So the only hope for this stock to go up, is to squeeze enough short sellers. And that’s very similar to CODX, where you had the pre-market spike, bounce, or dip down to the 160’s, bounce near the market open to two and now it’s just fading again. It’s still up 70% on the day, but when you go into
    the details, you know. This is CODX. It’s tried to spike a
    few times and failed. When you have a history of failure, and look at this big
    spike back in January. Remember that day? That was crazy when it went
    from one to the three’s and it just failed, and
    then it came back down. So stocks like this and charts like this, it did put together a multi-day run up back in May of last year, so it doesn’t always just fail on day one but more times than not, it does. And that gives short sellers more confidence that it’s gonna fail. And already they’ve been rewarded. If you shorted near the market open in the 180’s, 190’s or twos, you’re already up 20, 30% on your short. It’s tough for me to buy these stocks because you know that if they do go up, it’s only because shorts
    are getting squeezed, otherwise the shorts are in control and they’re just gonna
    pound it down into oblivion, which is what we’ve seen again and again with a lot of spikers. It really pays to know about short selling and how to avoid it. Kind of understand the battle between longs and shorts. And right now on CODX,
    shorts are in control. GHSI, aside from one little
    squeeze yesterday morning, the shorts are in control. – [Female With Red Shirt] Yesterday, I saw one comment from the profitry. They messaged there on the
    SEC filing, the 424B3 filing. What does that mean? I tried to search, I cannot find it. – Let’s see, that’s Michael Goode. He loves reading the filings. I mean, I don’t. For me, it’s just like a
    battle between longs and shorts but if you go to OTCmarkets.com, which is just a good website for filings, they usually have it. There’s also a lot of SEC
    filings where they file but it doesn’t really impact the price. Companies have to put out their filings but they’re not necessarily
    market moving stuff. Yeah, so they put out their 424B3 filing. They’re reselling some shares so it’s basically just
    a way to do a financing. And that’s part of the reason, when these companies spike up, there’s demand for their shares, there’s demand from investors. Most of these companies
    are borderline bankrupt so they need to raise money. So if the stock goes up,
    they’re not excited that, hey, we’re valued higher, it’s more like, the stock is up, let’s do a financing. Let’s raise money while
    people are excited about us. And that’s what this filing is. So, the shares are offered from time to time by selling shareholders and this is the thing,
    where you have either, I mean there’s many different
    kinds of financings, but no matter how you slice it, people are selling
    shares into every spike. When you have a massive spike
    like GHSI had yesterday, I mean, look at today. Today it’s like there’s just no movement and it’s partly because I think people are selling those shares. That was a filing for 22 million shares so those shares need to be absorbed before you can just have a normal market. And then you have short sellers, who know that there are shares being sold, so it’s kinda like,
    there’s blood in the water and the short sellers are
    sharks so they know to attack. So not only do you have
    the 22 million shares being sold by insiders, now you
    have up to 22 million shares plus probably like another,
    maybe five or 10 million shares, being sold by short sellers because they know that
    there’s other sellers. It gives them a cushion. And this is what happens
    with a lot of these stocks where they go up for a day or two, and then the shorts take control, the financings take control and that’s why most of these
    penny stocks just drop. That’s the whole short sellers argument. They’re like, let’s just
    short anything that’s up because the company will
    probably do a financing, they need money, and that’s it. – [Female With Red Shirt]
    Is this a pretty good idea, if you see they have insider selling? So insider selling, then short sell should be go get a same boat? – The problem is is that this
    filing was out on July 15th so the filing was already
    made before the big spike and this is where it becomes inexact. Where you know that there’s
    22 million shares being sold but at the same time,
    the stock spiked big. I mean if you bought it near
    the market open yesterday at 130, I mean, it went up to three. So the stock nearly tripled, even though there’s bad news
    already in an SEC filing. So, this is where it’s
    not an exact science because a lot of short sellers will say, this is bound to come down,
    there’s a lot of sellers. They were right over the course of a day but if you also took the opposite argument and you said, you know what,
    there’s warrants, yeah, there’s financings, I don’t care. There’s a lot of short sellers that usually short too early and that gives it more spike. No big or good company
    is tripling in the day so sometimes the worst companies
    with the most financings and the most insider
    sales, spikes the most. And that’s tough for people to understand. How can the worst company spike the most? But, it kinda creates an inversion, even if it’s only temporary. But GHSI was a fantastic
    short squeeze yesterday. But now, the shorts are in control. – [Female With Red Shirt] So that’s make a short sale can be pretty dangerous practice
    – Yeah, I mean. – If you are not accounting for that. – I mean, DRYS, I don’t know
    if I have it on this computer. – [Female Audience Member] I
    remember watching that one. – A few laptops ago. But DRYS, let me just see
    if I posted the chart. I mean, this is the worst fundamentally flawed company possible
    and here’s the chart. This is a five day chart
    and it went from five, all the way up to $118. This is a five day chart, okay. So this thing went up, you know, what, I don’t even know. What’s 118– – [Female With Red Shirt]
    It’s making history. – What’s 118– – [Female With Red Shirt]
    Everybody was talking about. – [Female Audience Member]
    That one I remember had 260 or 262,000 shares
    available when that spiked? – [Lecture Host] Yeah. – [Female Audience Member]
    Yeah, I was like, what the hell. – I mean, there were a lot of
    people, I don’t remember who, somebody shorted big in the 30’s or 40’s. I think it might have been Tim Grittani. Yeah, Grittani told this
    story where he shorted, he was on vacation somewhere and he shorted big in the 40’s, being like, this is ridiculous– – [Female Audience Member] And
    let me guess, he lost, right? – He did, he lost. I think he might have
    just shorted 1,000 shares, don’t quote me on this, but I
    think he shorted 1,000 shares. He was on vacation, it
    was like five to 40. This is ridiculous, it’s gonna come down. I’ll make an easy 10 or 20,000 and then I think he
    covered it at like 75 or 80 and he lost like 30 or 40,000. But that was good because
    then it went to 118. But this thing, I’m kinda sad because this thing could have gone higher. It was spiking pre-market
    when it got halted by the SEC. So this wasn’t even a trading day. I just took a picture of
    it because it was amazing, because it broke the previous high, shorts were getting
    squeezed left and right, and then it got halted. And basically there was my special brokers were CenterPoint and,
    what was their other name, oh Capstone Securities. These were like the two brokers that had so many shares to short
    of these special names. And they were literally defunct, like they were out of business
    with this stock at 118 because there were so
    many people who were short and they were down so much. And the SEC stepped in, I don’t know if they made a call or whatever, but they halted it and then
    when the stock reopened, it was down 40, 50%. But this is a terrible company, terribly just raped by insiders, no fundamentals whatsoever and the stock became, you
    know, it went up 20 times. This is just one example, but this is a good example
    of where a terrible company, no matter the insider sellings, no matter the logic or the valuation, when there’s enough
    shorts and you trap them, it can create this massive powder keg. Hey Tim Sykes, millionaire
    mentor and trader. Thank you for watching my videos. I hope that they help you. I want to share everything that
    I’ve learned over the years. You can check out more
    videos, right over there and also click subscribe so that you can watch all of these videos,
    get that knowledge, and become my next millionaire student.

    The Best Stock To Dip Buy Today | 50% In Less Than 2 Hours!
    Articles, Blog

    The Best Stock To Dip Buy Today | 50% In Less Than 2 Hours!

    September 24, 2019


    – [Narrator] Hey, Tim Sykes
    here, it has been a crazy, crazy day. I want to recap it,
    there’s some good lessons. I’m sorry for sounding nasaly. I am here, actually, in Asia. I’m filming this in the
    middle of the night, the time zone is not so great
    to trade US stocks here. I’m visiting several of
    my new schools that my charity has built, I’ll
    post photos and videos soon, but it’s an honor really
    to visit these communities and meet with the kids and their families. And then at night I’m
    trading so that doesn’t leave too much time for sleep. But first I’ve got to talk about
    what’s happening right now. Below Deck is this TV show
    that my top students and I are on. It airs tonight at nine PM
    eastern on Bravo November 28th. Season five episode 13. This is my second millionaire
    student, Tim (mumbles), lifting up his wife and
    that’s like their little party trick. It should be pretty cool, I
    don’t know what to expect, they usually make me look
    like an ass but I kind of make myself look like an
    ass so it’s not really their fault, it’s mine. Last time I was aboard
    the yacht I actually made $70,000 on a trade with like
    three cameras in my face. They did not show it. But the good news is that
    it basically paid for the whole trip. So there’s good and bad
    with this show and a lot of people ask me why do I
    subject myself to this? I don’t care about looking like an ass. As long as I can try to
    get my teachings out there and the word out there that
    you can trade stocks from anywhere, the fact that I
    can make $70,000 on board a yacht with very little wifi. I’m not gonna ruin what
    happened this trip, this is my second trip, but
    just know it’ll be a pretty good episode so set your
    DVRs to November 28th nine PM eastern on Bravo. It’s called Below Deck. I’ll post clips once it airs,
    but it was a good time again. I should also mention yesterday
    I hope that you watched this little video that I posted. I gave away $10,000 cash
    to some deserving students in Newark and if you read my blog post, I also gave away roughly
    $10,000 for the one Bitcoin giveaway. If you go to timothysykes.com
    you can read that blog post. I’m sorry I’m so behind. I announced this giveaway
    literally a month ago and I’m so far behind on everything. It actually benefited the winner. His name is Harris, I
    picked him randomly out of tens of thousands of people, Harris S. I don’t know if he wanted
    me to share his last name so I just didn’t. But Bitcoin has risen from
    6,000 to roughly 10,000 since I announced the
    giveaway a month ago. Just to give you an idea of
    how fast Bitcoin is climbing. So it cost me an extra, roughly,
    $4,000 by not announcing the winner right away. And that’s cool, I’ll give away $10,000. So I like this. And a lot of you guys are
    messaging me that you like it too and I’m proud of that. There’s some BS artist on the
    internet where they giveaway like an iPhone or they
    giveaway $100 and it’s like, dude, if you claim to be rich
    why are you being so cheap? So for me I want to give
    away meaningful amounts, no different than the million
    dollars that I gave away to Pencils of Promise earlier this year, my favorite charity. It blows my mind how much
    people make and they give away so little. I want to try to change that,
    I want to try to teach you. And that’s why I’m so proud to do it, that’s why I’ll always
    showcase every single donation, every single gift. And by the way, the Bitcoin
    giveaway and the $10,000 cash giveaway, that’s not from my charity. My charity has very strict
    rules, I can only donate to other charities. This is just 20 grand out
    of my pocket and I want to pay it forward. So if you like that leave
    a comment underneath this video saying, “I like this.” And I’m curious to see how many
    of you actually do like it. I think it’s cool. I’m trying to put myself in
    your shoes and if I was just starting and if I needed
    some encouragement to study I think it would be cool if
    my teacher gave away like 10 grand to random people. I don’t know, you tell me. If you like it leave a
    comment underneath this video saying, “I like it.” Also, you have roughly two
    or three days left on this Profitly sale on all these
    newsletters and guides. 30, 40, 50, 60% off. And Stocks to Trade is also
    having a Thanksgiving special. This will end at month end, both of them. So take advantage of these sales. We like giving back to you
    guys and I think that it’s imperative that you
    invest in your education. Speaking of, today I had a very good day. I made a few thousand
    dollars, three trades, some better than others. GLNNF probably actually
    should’ve made like triple this, but I find that my best
    trades I usually leave a lot on the table. So here is GLNNF morning panic. It’s been one of the strongest
    stocks in the market and, frankly, we got the perfect morning panic. And I thought that there
    would be support, right here, in the 220’s and it blew
    through that support. So I’m glad that it held the 170s. They did a financing I think
    at like $2.30 a share today so that’s theoretically
    what it should be priced at. When a company does a
    financing they sell shares to institutional holders,
    hedge funds, and these are sophisticated investors. So theoretically they get
    the price that they think the company is worth. That’s why the stock dropped
    from the threes all the way down to the low twos and
    even high ones because the financing was done at a discount. That’s what these companies are all about, they pump themselves up with
    press release after press release and then they
    try to do financings. Or sometimes they can’t
    even do a financing. Like IZEA couldn’t even do
    a financing when they pumped themselves up with like 30
    press releases a few weeks ago. Anyways, this opens the
    door if you are prepared for the morning panic pattern. So these bad companies actually
    make for great dip buys. And this thing got down to
    180 and it’s already bounced all the way to 274. Let’s just do some math
    for a second, hold up. 2.74 minus 1.8, divided by 1.8. This is 52% on your money
    from 10 AM until 11:45. So in an hour 45, one hour and 45 minutes, not even two hours we’re
    talking 105 minutes you can make 50% on your money
    if you time it perfectly. Now, I don’t time things perfectly. I took the meat of the move and, frankly, I probably could’ve done
    a better job selling. But as you hear I’m not feeling
    that well and it’s scary as shit to buy these stocks. So I took my little 10%, my
    goal was to make 10 or 20%. As it turned out there was a 50% bounce. And some of you guys are like, “Well how did you know to spot this?” Here’s a blog post I wrote. I said try this every morning
    and you’ll make money. This was several months
    ago and this is the exact same pattern. This is ZPAS where it
    dropped from 260 down to 180 all by 10 AM and then guess what? By, I guess by like noon it
    had already bounced to 250. So compare this pattern on
    ZPAS to this pattern on GLNNF. It is the exact same. You simply have to follow my instructions. Sorry, I have too many windows open. Try this every morning
    and you’ll make money. Too many of you guys say, “Oh okay, I’ll look for this
    pattern,” but then you forget for a day or two days
    or three days or a week and you miss out. I’ll tell you the truth GLNNF
    wasn’t even on my watch list. I thought that I had missed
    the boat ’cause it had gone up so much I was like,
    “Damn, I should’ve bought the “breakout here, now it’s just
    gone too far I don’t want “to chase it.” But then the pattern that
    I know and love comes to me and opens up that opportunity. And I’m not gonna ignore
    that opportunity when I see a pattern that I know very well. And I bought it pretty well
    in the 180s and I sold it pretty poorly here in the low twos. I didn’t know how far it was gonna go. I would not have held to 275
    let alone 250 or even 240. But for me, next time this
    happens, I will try to hold it until like 210 or 220 and try
    to make 15, 20% as opposed to just 10%. Because this is a strong pattern. Maybe sell half and let the
    other half go for a little bit. Because this is clear panic selling. And a lot of you guys are
    like, “Well Tim, you say only “focus on the big percent
    winners, how did you find this?” This is a big multi-day percent winner. It’s not just about entry
    day percent winners. I’m always looking at
    the strongest stocks. MARK, for example, this is
    a great earnings winner. And this just keeps going. You can see how bad my wifi is. It’s not even gonna load. There it is. So this one hasn’t really
    been a big percent winner on any day, but it’s been
    a big multi-day winner so it’s on my watch list. Always watch multi-day winners. And again I have this
    blog post, I’ll link it, ZPAS is just one of then. There was another one,
    CATQ had the morning panic and the bounce. CNAB had the morning panic and the bounce. This was EMMD had the
    morning panic and the bounce. And then I gave a little graphic, trading stocks like a sniper. So waiting for my shot. And GLNNF was that shot. Bounced a lot more than
    I thought it would, but the biggest thing
    that you should take away from this is that it’s the
    exact same fucking pattern. Doesn’t matter if I’m
    filming this at one AM, doesn’t matter if I’m
    sick, if I’m healthy, I know to look for this pattern. And I even alerted it in the
    chat room before I bought. This is why it’s so key
    for you guys to be in the chat room. I specifically, first of all
    I had an overnight play on XIN that did nothing so I just got out. I’m glad I took some profits
    into after hours yesterday when I hit my goals. But right here at 9:39 AM
    GLNNF potential Sykes morning morning panic pattern. This is the blog post. This is at 9:39 AM, this was
    when the stock was right here and it was at 220. And I actually thought that
    it was gonna hold support at 220 and I’m glad I didn’t
    just try to dip buy anything. If you try to dip buy just
    like a crazy falling stock trying to catch a falling
    knife is a bloody mess. So I said potential dip buy. And that should’ve been
    your alert to recognize, wait a minute, if you read this blog post, if you know this pattern, I
    have hundreds and hundreds of video lessons on this one pattern. If you go to tim.ly/sykesdipbuys
    there’s a whole category on buying dips in panics. And you need to watch
    all these video lessons. It’s not an exact science,
    you don’t know exactly when the bottom is gonna be. But if you watch enough of
    these and you experience enough of them in real time
    you can start to feel around where the bottom is. It’s not as hard as you might think, you just need to study the past. And that’s why I make
    all these video lessons, that’s why I alerted it. So I alerted at 9:39 I didn’t
    buy it for another nearly 10 minutes. And I got a few different executions. It might’ve been like
    seven or eight minutes. But I specifically alerted
    it before I bought it because I want you to watch
    this stuff in real time. Even if you don’t buy it. As long as you witness it
    and you start seeing the potential because I know so
    many people are out there saying penny stocks are
    scams, Tim Sykes is a scam. If you start witnessing
    these patterns, first of all, send them this video, second of all, if you see it it’s
    actually pretty amazing. And I know a few of you caught it, I know a few of you did better than me. It’s not hard, okay? It’s really not that hard
    if you’re prepared and you have the patience to wait for it. Some plays don’t bounce. Like EKSO, I’ve been
    trying to dip buy this. This one had like a little
    panic and weak bounce, a little panic, a little panic,
    a decent bounce yesterday. That was my big winner yesterday. But what I find, and if you
    watch these video lessons, it’s these really sketchy ones
    that run up really quickly and then panic really quickly
    that offer the best bounces. So that is GLNNF. You know, it’s just a question
    if you’re prepared or not. And that’s why I show you these sales, that’s why we have these sales,
    that’s why we have all of these guides. It’s not a new pattern, okay? It’s really not. If you watch Pennystocking Framework, this is a classic, classic,
    classic number four, number five pattern. I have a seven step framework
    in this guide and this is the same exact pattern,
    it hasn’t changed one iota over the years. I make all these video
    lessons, I scream at the top of my lungs, I lose my voice,
    and really only a few hundred of you even bother to pay
    attention because they don’t come about every day and
    so you get out of practice and then you forget about it. And then when it does happen
    maybe you’re doing something and you miss out. I get it, okay, I’ve been there. But just do me a favor so
    that every single time this happens you start to recognize
    it and you start to say, “Wait a minute, there is a pattern here.” Because some people think that I’m crazy, some people think that these
    patterns are in my head. And part of the reason why
    I love teaching so much and documenting everything
    is that it’s clearly not in my head. I have hundreds of examples
    of this one pattern. And usually I sell too soon. It’s not a new thing. But at the same time I’m
    still making a few thousand dollars at a time and it
    still adds up to millions of dollars over the years. So that was my big trade for today. XIN locked in roughly 1,000. Just did not gap up
    the way I wanted and so I quickly got out. Yesterday after hours it
    was making new highs and I actually got some good sells
    because it hit my targets. And when you have a stock
    that hits your target and you don’t have to hold overnight,
    I probably should’ve sold everything, but at the
    same time I wanted to see if it could run. It was a block chain play. Block chain plays can really run. That’s why I bought OHGI,
    they came out with a press release today teasing
    that they’re gonna acquire a company. They’re making it basically
    seem like it’s gonna be block chain or Bitcoin related. (coughs)
    Excuse me. This stock has run huge
    in the past before. So I didn’t chase it from 130 to 170, I actually bought it
    on the dip in the 140s. Got a little bounce back
    to the 160s, but not much. Now it’s hanging right
    around where I bought it. I’ll still watch it because
    if you look at some of the hottest stocks right now
    in the market, like RIOT, which went from the sevens to 24. Or BTSC which went from
    11 cents and now 45 cents in the past few days. Block chain, Bitcoin related
    stocks are so freaking hot right now. That’s what I look for. I look for patterns that I
    know and I look for sectors that are hot. That’s it, if you keep it
    simple you will do better. And sometimes a stock like
    XIN is not gonna continue. So I simply got out. For EKSO which I’ve been dip
    buying hasn’t really bounced so I simply got out. You’re not gonna be
    right every single time, but if you’re willing
    to cut losses quickly, if you’re willing to take
    smaller gains than you wanted and then sometimes you will
    be dead on right like I was on GLNNF. My gain on GLNNF is bigger
    than all of my smaller losses and smaller gains
    in the past few days. And I didn’t even time it perfectly, okay? I sold it in the low twos. This could’ve been a
    $10,000 profit if I timed it perfectly. And I’m not saying I’m
    gonna time it perfectly, I just want you to see the potential here. Where some of you guys are like, “Yeah Tim, it looks awesome
    that you’re making two “or three thousand, but you’re
    trading with a big account.” I’m trading with a bigger account, yes, also next year 2018 I’m
    just gonna trade with a $12,000 account going back to my roots. So you’ll see exactly what
    I’ll do with a small account. But at the same time, also,
    when I’m making two, three, $4,000 on a trade oftentimes
    I’m leaving five, six, seven, 8,000 more in profits on the table. There is so much freaking opportunity. The money that I’ve made
    from trading, 4.7 million, roughly, is just scratching the surface. And I also have to give
    props, shoot I forgot to mention this. Too many things are going on. Kroy Runner, he still
    has to update his stuff. He just did this yesterday. This is my top student, Tim (mumbles), he’s at 4.8 million. He actually made over $100,000
    yesterday, he texted me. He’s now over five million. And so we have this, the
    reason why he texted me, not to brag, but because
    I told him when he passed four million I would write
    the blog post with 40 lessons, but when he passed five
    million he had to write the blog post with 50 lessons. So he’s like kind of happy
    about passing five million, but then kind of unhappy
    about doing a blog post for my blog on timothysykes.com
    with 50 lessons. So it’s good, congratulations to him. There’s just so much going
    on right now and it’s pretty freaking awesome. So I’ve got to get some
    sleep, it’s closing in on two AM here in Asia and
    I’ve got a busy charity day tomorrow. I might wake up for the
    market close just because I like sounding stuffy
    and feeling like shit. But more importantly I feel
    obliged to show you these opportunities when they pop up. OHGI didn’t get the big
    spike that I wanted, but at the same time,
    it’s chilling here at 148, right where I bought it. XIN didn’t not get much of
    a continuation I wanted, but I got out, I protected
    myself, and I sold nicely a chunk after hours for some profits. And then GLNNF, I was
    just 100% dead on it. From that blog post I wrote
    months ago to the hundreds of video lessons on this
    pattern to my previewing in chat before I bought to my buy, everything went swimmingly
    well except for my sell, which was a little too
    soon, but I still locked in profits and now I’m gonna
    get some sleep and prepare for the Below Deck madness. This is at nine PM eastern tonight. So roughly eight hours from
    the time when I publish this video lesson. So set your DVRs and if
    you miss it tonight I think they play it throughout the week. It should be a good time. Thank you guys again. Also take advantage of
    this Profitly sale and Stocks to Trade sale. Don’t say I didn’t warn you
    ’cause I’m mentioning it several times in the video lesson. I’ll see you guys in the chat room, congrats to all dip buyers
    and even if you did not dip buy GLNNF or any
    of these Bitcoin plays, at least hopefully you’re
    watching and learning, that’s the key. Let me know if you like
    video lessons like this, leave a comment underneath
    saying, “I like it,” if you do. I’m curious to see how many
    of you even pay attention and even make it to the
    end of these video lessons. I know they’re long, but
    I think they’re useful.